Industry data-sharing solution moves closer to reality

par Susan Yellin | April 02 2015 10:00AM

They said an industry solution that would link key information among life insurance carriers, MGAs and advisors would never happen. But APEXA Corp.’s plan to help connect all three groups, is now moving closer to reality.“One individual said to me: ‘I’ll go and lie down on the highway during the busiest part of the day if you can make this work’,” said Doug Paul, a vice president of business development at SSQ Life.

But Paul told a gathering of the industry in February that a combined effort by carriers and distributors, working with advisors, is progressing to the benefit of all three groups.

Advisor screening

For MGAs, APEXA is expected to assist in a more comprehensive method of screening and ongoing compliance of their advisors – a move that should please most regulators. Advisors will be able to input such information as their licence and E&O insurance once rather than for each MGA; a pop-up will appear when their licences and insurance are due and automatically update their MGAs. Carriers will see a more all-round, cost-efficient process.

“All the times before this that hadn’t worked was because people found ways that it couldn’t – or shouldn’t – work,” Paul said. “It became: what do we need to do to make this work? It was just a subtle shift in mind frame that made the difference. It was unbelievable.”

Helping to shepherd the creation of the system are representatives from PPI Solutions Inc., HUB Financial, Financial Horizons Group and the IDC Worldsource Insurance Network, as well as insurers Manulife Financial, Canada Life, Sun Life Financial, Industrial Alliance and Empire Life.

Taking all their needs into consideration is insurance consulting firm LOGiQ3 Corp. (which created APEXA), along with BlueSun Inc., which has developed the technology. Paul is credited for his consulting work with LOGiQ3 in its initial phases.

When the system launches, expected by the beginning of 2016, it will be available to all MGAs and insurance carriers.

As well, Paul said APEXA is taking into consideration some guiding principles brought forward by advisors and is also putting the finishing touches on some governance issues.

With compliance taking on an increasing role in financial services, the timing of APEXA couldn’t be better, said Terri Botosan, president of HUB Financial.

“The fastest growing department in my company is compliance. I just saw that running right out of control,” said Botosan. “From an MGA perspective, it has changed so much and so quickly in such a short period of time that we just kept bolting on different processes. It was becoming an unwieldy thing that was not solving much. We needed a better way.”

She said APEXA will replace previous random selection runs on advisors, no longer putting advisors through unnecessary processes.

But introducing new technology is always tough and there will be advisors who push back on the new system even though there will be plenty of live presentations at HUB roadshows, said Botosan. The more tech-savvy advisors will be delighted that they only have to input major information once, but a similar-sized group of advisors on the other end simply don’t want to learn more technology, she said.

“I’m not going to pretend that it’s going to be easy,” said Botosan. “It’s a thing. But it’s not going to be the thing that stops this.”

Botosan also said a big takeaway for advisors is that APEXA will help them maintain their independence. While the new process helps MGAs have better oversight over advisors, it also allows advisors to choose where they do business. “One of the questions we really struggled with is: how can I have oversight when they have a relationship with four different MGAs and I’m only seeing the business that they choose to send my way? I know this doesn’t totally solve that here but it really gets us in a much better place. And I strongly believe that advisors want their independence.”

APEXA really started gaining some traction about a year ago and caught some carriers’ notice because of the huge efficiencies it can provide, said Stephen Biringer, vice president, operations at Empire Life.

“We’re always looking for something that is scalable, we want the efficiencies and where we can standardize things. And this is one of the initiatives that did take off.”

Empire Life has thousands of advisors, and APEXA will make getting the necessary compliance information much easier. “We tried to reinvent the wheel on our own and it just doesn’t happen that way.”

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