Designations: Senior and Otherwise

A frequent topic of conversation around our office is designations and business names used by insurance producers. While there has been regulatory focus on designations that have a senior focus, there are many others, some of which are equally unclear as to the actual work needed to obtain and maintain the designation. So we were happy to see the column by Frederic P. Gabriel, Jr. the editor of InvestmentNews, in the August 19-23, 2013 print edition, titled “Wading through the alphabet soup.” His lead is: “The financial advice industry has long been criticized for having too many professional designations – some good, some ok and far too many just worthless.” The same is true of the insurance industry. Far too many just worthless, and that is despite the NAIC Model Regulation on the Use of Senior-Specific Certifications and Professional Designations in the Sale of Life Insurance and Annuities (Model 278).

Mr. Gabriel informs readers that InvestmentNews avoids using professional designations when running letters to the editor. “The policy is based on the simple fact that we do not want to be seen as promoting one designation over another. We also try to avoid promoting designations or credentials that are essentially worthless, and quite possibly dangerous to consumers.” He asks the question, if they were to use designations, how should they decide which are ok and which are not? “What criteria would we use to disallow some designations and not others? Number of designees? Level of coursework? The stature of the organization behind the credential? How about whether that credential comes with a clearly stated code of ethics?” Finally he asks: “Common sense?”

Based on the experience with the above-referenced model, it seems to us that as soon as an effort is made to answer the question about which are ok and which are not, the creative minds out there find ways to beat the “system.” All the questions asked above are good ones, but they don’t always tell the whole story. It could be a full-time job to stay on top of all the designations and the organizations that promote them. So where does that leave us? Common sense depends on information, which takes us back to the full-time job problem.

Perhaps more of us should follow the policy of InvestmentNews and just not print them. That certainly hurts those who go through the rigorous programs that are out there and do earn real designations that carry real value to consumers. Perhaps then those individuals become part of the effort to clean up designations, too. If it becomes an effort led as much by CFPs and CLUs as by regulators and compliance departments, maybe we would have more luck clearing out the worthless designations.