Guidelines for Use of Professional Designations

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NAFA Guiding Principles are published by the NAFA Education Committee for annuity professionals to help them prepare to better communicate with consumers. The following is a summary of NAFA Principles for Use of Professional Designations. Learn more and read the full principle paper and others here:

The pursuit of professional designations can help further your abilities and knowledge to help you assist your clients. In recent years, the number of designations that are used by individuals in the annuity and life insurance industry has increased substantially. It’s important to always identify yourself and your professional background without misrepresenting the fact that you are a licensed insurance agent who earns commissions on the sale of products.

Here are guiding principles for financial professionals when selecting and denoting professional designations.

  • Do not use labels such as income planner, asset protection adviser or retirement consultant
  • A designation used in advertising should be current and verifiable
  • A designation should represent some significant achievement of knowledge, which could be relevant to the advertised insurance
  • A designation should be awarded by reputable, accredited organizations within the insurance and financial industry

NAIC Model 278

The purpose of this regulation is to set forth standards to protect consumers from misleading and fraudulent marketing practices with respect to the use of senior-specific certifications and professional designations in the sale of life insurance and annuities.

  • Do not use a senior-specific certification or professional designation that misleads a purchaser
  • Confer with your state’s Department of Insurance, the carrier, any applicable broker dealer and specific agency rules
  • Maintain your approved credential by performing CE tasks or recertification as required by issuer
  • Do not use acronyms intentionally similar to other accredited designations which obscure your qualifications
  • Do not use designations that can be earned by paying membership fee without testing process
  • Only use academic credentials earned through school or training
  • If you sell a fixed annuity product, identify yourself as an insurance agent

General Advertising – Regulatory Action

There are many cases that have been cited publicly as contributing to both NAIC and Securities guidance. They involve not only the designations themselves in most cases, but also cross into the realm of unethical sales practices and some have resulted in regulatory or administrative action against the agent for misrepresentation and deceptive advertising.

The NAIC Model Regulation on the Use of Senior-Specific Certifications and Professional Designations in the Sale of Life Insurance and Annuities was originally adopted in July 2008.  Since that time a majority of states have adopted the Model, in full or in part, prohibiting the use of such designations that falsely suggest expertise or mislead clients into thinking that the agent has special training in advising or servicing seniors.  Of particular concern is where words such as “senior” or “elder” are combined with words like “certified” or “advisor” or “specialist.” Some states, in fact, specifically list those designations that are allowable. Top priorities for all insurance agents should include protecting consumers from misleading practices, offering authentic credentials, and upholding ethical and lawful standards. When considering a designation to pursue, take steps to determine if the designation is appropriate and approved. This includes checking with your insurance carrier’s compliance department, your state Department of Insurance and your compliance personnel.

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