Agents have many continuing education options. Unfortunately, CE laws created a requirement that is often addressed with taking the easiest and cheapest courses available.  Many of the courses meet the letter of the law but do little to increase the agent's knowledge.  I have been in the insurance business for 47 years and have spent every day continuing my education.  I am a strong advocate for insurance designation programs.  There are designation programs for almost any job in the insurance industry.  CIC is helpful to agents because it is geared specifically to the needs of insurance agents.  CPCU is a great program but requires a significant investment of time.  There are many “specialty designations" for most of the jobs in the insurance industry – claims, underwriting, risk management, reinsurance, etc.

What is needed most is quality education programs taught by quality instructors.  The sad reality during downturns in the economy is that education is one of the first line items cut from the agency budget.  Providing employee education can be very expensive for an agency owner.  Balancing quality with price is often a challenge and some agency owner's opt for price.  Free courses are preferable but “you get what you pay for."  Quality education can increase an agency's bottom line and reduces the agency's errors and omissions exposure.

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Insurance policies are very complex documents.  The comprehension level of many policies, including "easy to read" policy forms, is often at graduate level.  The reading may be easy, but the comprehension is not.  Risk assessment involves graduate level complexity. 

The concept of “professional" is a process of exclusion.  It is a commitment to high ethical standards, mandatory education and training, mandatory continuing education, membership in formal associations or societies, and public recognition of the profession.  The person must complete a recognized course of study, they must successfully pass a recognized series of examinations and they must abide by a code of ethics. 

Let me encourage you to look at insurance education as you would university education.  In particular, look at delivery of the curriculum and the student's comprehension of the material over time.  Having served 8 years on a college board where we carefully evaluated both student and teacher performance, I will share an example:

Consider a college student who attends class without preparing for the lecture, does not review following the lecture, and crams for exams.  While the student may have the ability to cram and receive a passing grade, their comprehension of the material in six months will usually be in single digits.  Conversely, a different student prepares for class, takes notes, reviews after class and studies incrementally for exams. After six months the second student's comprehension level will approach the score on their exams.  One student may have passed the course, but their long-term comprehension level is 9% to 12%.  The better student's comprehension level is 75% or 90%. 

Many insurance education programs are lecture formats where the student sits through a lecture.  The content and instructor may be exceptional, but there was no preparation for the lectures nor review following the lectures.  There was no incremental study over time in preparation for the exams.  Within six months the attendee's comprehension level of the material is on par with the student who crammed. 

Industry education courses offered by the Institutes, which include CPCU, AAI, ARM, AIC, and many others, have been evaluated by the American Council on Education (ACE).  This body qualitatively evaluates the programs used on college campuses.  The Institutes courses are recognized as being eligible for credit in the following tiers:

a. lower division undergraduate;

b. upper division undergraduate; and

c. graduate

The texts and course materials provided by the Institute programs are used in colleges and universities across the United States.  I would like to think the CPCU curriculum, examinations and work requirements are on par with CPA curriculum, examinations and work requirements. 

The proof is in the pudding.  As one who works as an expert in complex insurance related litigation, I seldom see men and women who have Institute programs listed behind their names as defendants in court.  And with few exceptions these men and women are defensible. 

Let me encourage you to take a careful look at the offerings available from the Institutes.  Carefully consider which course best supplies information for the subject area where you will be engaged.  Prepare for class, review after class, and prepare incrementally for your exams.  The key to professional performance is long-term retention and comprehension. 

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What CE programs do you believe are best for an agent to establish a solid knowledge and properly advise clients?

Agents need to start with a broad understanding of the industry, all functions from sales and service to underwriting, claims, etc. They also need a basic understanding of all insurance products regardless of what they will be selling and/or servicing. Then they need in-depth knowledge of the products they sell or service.

Are programs such as the CPCU, CIC, AAI, etc. necessary to become a true professional? 

They are not “necessary" to the extent that equivalent content can be obtained elsewhere, but these programs are structured so the product training is coordinated within each designation. The biggest value is that they demonstrated a tested understanding of the content and a commitment to education and accomplishment.

What is needed most in our industry regarding training and education; how do we achieve it? 

Most agents don't read the policies they sell, much less really understand them. Many of them that do have difficulty in apply their knowledge to coverage questions and claim scenarios.

What advice would you give a friend searching for an insurance agent? What traits or credentials would you suggest they look for? 

5 Important Questions to Ask Your Agent About Your Insurance Coverage

Many industries such as the medical and legal fields have evolved from being generalist to specialist over the years. It seems this trend is slowly happening within the insurance industry. Many generalist feel they are well equipped and experienced to handle any risk from home and auto to trucking to airplanes to restaurants to life and health. What are your thoughts on niches? Do you believe they are needed in the insurance industry or can someone genuinely specialize in so many different things? 

Small business owners often have the same types of exposures as giant corporations…property, business income, general liability, professional liability, workers compensation, auto, inland marine, cyber, etc. It's impractical to sell and service insurance only with specialists. Where niches can be of value is in marketing…knowing an industry's unique exposures and being able to insure them.

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There is a lot of good education out there to help agents become more professional.  Sadly, there is so much emphasis put on sales skills that technical skills are often downplayed.  We need more employers who support professional education such as designation programs.  There are many great programs out there such as the ones you have mentioned, and they each have different merits.  Committing to a professional designation program helps an individual obtain a broad knowledge that adds to their professionalism.

What type of education is needed most?  Today, how to read and understand a policy.  Fewer and fewer agents today are willing to pick up a policy and really understand it.  Many of the “baby boomer" generation agents had a clear understanding of policy language, but as they are retiring, that knowledge is being lost.  Reading a policy is not necessarily “fun," but those who can raise themselves to a much higher level of professionalism.  How do we accomplish this?  Good question.  We need more role models and mentoring in my opinion.

If my friend was looking for an agent, I would tell them to first find an independent agent who is in a better position to offer options to serve their needs.  Next, professional designations of any kind.  (L&H designations when shopping for those products, P&C designations for P&C products).

There is no question that the insurance industry is becoming more specialized.  Agents who are generalists and say they can sell any type of insurance are not doing a service for their customers.  Know your limitations. If the agency has others who specialize in an area that you do not, refer to them or seek their assistance.   If your agency lacks a specialist for a certain line of business, you may want to refer to another agency.  Some risks or types of coverage can be very complex and should be handled by those who understand all of the exposures involved, how the policy applies to those exposures, and what solutions can be offered.  I think having niches is a great idea.  This helps agencies succeed in the areas where they have the most expertise.  This is a diverse industry.  It is nearly impossible for someone to be an expert in insuring oil fields, hospitals, airports, tugboats, movie studios, wind farms and skyscrapers all at the same time.  Recognize your strengths and stay within your areas of expertise.

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I believe CPCU remains the premier professional designation in the property-casualty industry, no matter the professional “specialty" of the individual.  In fact, I've always thought the name – Chartered Property Casualty Underwriter - can be a bit deceiving because the courses study far, far more than just “underwriting."  It provides the serious insurance professional a solid background on all aspects of property-casualty risk management and insurance: important personal lines and commercial lines coverage forms, risk management principles, insurance and GAAP accounting principles, government insurance programs, the legal foundation of insurance, rate making, reinsurance, and on and on.

At the same time, I personally am a big advocate of the AAI (Accredited Advisory in Insurance) program for agents.  It discusses subjects related to insurance marketing and sales in greater detail than is possible in the wide-ranging CPCU program. 

For the agent desiring to specializing in commercial insurance, the ARM (Associate in Risk Management) program can be very valuable.  It is also relevant to commercial lines underwriters and loss control specialists. 

I think specializing in a certain area of insurance will become more and more important in the decades that follow this one.    

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Here are my thoughts:

What CE programs do you believe are best for an agent to establish a solid knowledge and properly advise clients? Are programs such as the CPCU, CIC, AAI, etc. necessary to become a true professional?

Question #1 - I wish there was such a course; however, CE stands for continuing education.  I believe that an agent can never stop learning and never has all the knowledge needed.  Insurance is an old business, but it is a contemporary business.  Exposures change constantly.  Agents need to update their knowledge continually to stay abreast of new and emerging exposures and ask the right questions of insureds to uncover their exposures to loss.

Question #2 - we are a profession.  True professionals in any occupation needs advanced knowledge.  Our professional promises to assist our insureds in protecting their assets against loss.  How do we keep that promise unless we have a solid, in-depth understanding of loss exposures?  Education needs to be both on-the-job and formal.  Designations, based on the agent's job function, provide that formal education component.

What is needed most in our industry regarding training and education; how do we achieve it?

Agents complain that insured's shop for price.  I see that agents, when educating their staff, often shop based on price.  There are a lot of educational opportunities out there.  Staff education should not be driven by the cheapest course with the most credits, but the quality of the program and whether the topic will enhance the knowledge of the staff person or not.

E&O statistics show that claims against an agency are more likely due to a lack of knowledge. The claims are highlighting the need to make better management decisions on which courses, which provider, and which medium provides the best outcome.

What advice would you give a friend searching for an insurance agent? What traits or credentials would you suggest they look for?

Choosing the best agent varies based on the needs of the client.  Clients like to do business in various ways. Some prefer to socialize before “getting down to business" and at the other end of the spectrum some want “just the facts ma'am." My advice would always be to feel comfortable with the agent. Clients need to find the agent with whom they can establish a relationship through the phases of their life.  This agent will help them make good asset protection decisions as changes occur in their exposure base.  Developing this long-term relationship will allow the agent to better understand their exposures.

TV ads suggest that we should be shopping for the “best price" at each renewal.  First, what non-insurance professional wants to talk about insurance or even understands insurance?  What has the price told them - nothing but the price!?  This “advertising goal" has undermined the real purpose of insurance and given the buying public the misinformation that we sell one policy and the only difference is the price.

Insurance is a serious and critically important business. When disaster strikes, hopefully coverage exists to provide financial assistance.  It requires, however, that the possibility of loss was identified by the agent, insurance option(s) presented and the client, based on their appetite for risk and budget, purchased that coverage.  Establishing a relationship between the client and the agent allows a financial partnership targeted at protecting the assets of the client.

Many industries such as the medical and legal fields have evolved from being a generalist to a specialist over the years. It seems this trend is slowly happening within the insurance industry. Many generalists feel they are well equipped and experienced to handle any risk from home and auto to trucking to airplanes to restaurants to life and health. What are your thoughts on niches? Do you believe they are needed in the insurance industry or can someone genuinely specialize in so many different things?

The world is becoming more complex.  Industries that we didn't think of years ago as “professional" are experiencing professional liability claims.  People are working from home in capacities never anticipated under a homeowner policy.  Cyber liability exposures have taken center stage for businesses globally and, cyber protection is a combination of insurance and risk management. We need professionals that have a good handle on these and other emerging exposures. Generalists are still the mainstay and will continue to be the mainstay, of our personal and commercial lines workforce.  Generalists handle the bulk of the day-to-day market segment for most agencies.  However, in several commercial areas specialization has become necessary.  Agents that deal in some of these complex industries, or new emerging business operations, need insurance knowledge to analyze unusual and complex exposures as well as possessing an in-depth working knowledge of these industry's operations. This segment often times has limited markets available that offer specialized, targeted, unique products.  

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My first suggestion is to work with an agency that stresses education. Weekly meetings and experienced agents are a necessity. The real world differs from the book world. Join an association like the Big 'I' (Independent Insurance Agents & Brokers of America). Start with CIC and follow with CPCU and the CFP section dealing with insurance. Sign up on the computer with attorney firms that write free insurance information including current court cases.

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Within the insurance industry we have butchered the meaning of Continuing Education – or CE. Traditionally, continuing education was just what the name suggested – an undertaking to increase knowledge through ongoing study.

In the early-to-mid 1980s, when the first “CE" laws were enacted the idea of increasing knowledge was replaced by the need to check the “education box." The unintended consequence of CE was the death of true learning.

Although holding a designation shows or implies commitment to the industry (I hold several myself), designations are not ends in themselves. Yes, I fully support and heartily recommend that any insurance person wanting to advance in this great industry undertake these designation programs – as the beginning point of their education.

Sometimes education should be simply for education sake, not necessarily towards meeting CE requirements or even attaining a designation. Knowledge for knowledge sake is the best gift you can give yourself and, more importantly, the insurance buying public.

Although insurance may not be “rocket science," if you do not do it well you can possibly destroy your client's financial life. Yes, it is that important.

Don't limit education to just insurance. If you are focusing on a niche, learn the specifics of that niche. For instance, if you are writing restaurants, learn the ABC laws and health codes. This will round out your education.

I'll say this again, don't limit your education to checking the CE box. Make use of educational opportunities that keep you sharp. Undertake designations; check out educational offerings from Big I and IRMI such as the EXCEED program; and read the policy (yes, read the policy).

Last updated: November 20, 2020