Insurance is built on trust, relationships, and a commitment to protecting clients from unforeseen risks.
But as insurance agents continue to utilize phone calls to connect with prospects and maintain client relationships, they face a complex web of regulations. Chief among these is the Telephone Consumer Protection Act (TCPA), a pivotal law that governs how businesses interact with consumers over the phone.
This article explores why insurance professionals must make compliance a core priority, the risks unique to the industry, and actionable tips to help agents and lead generators stay on the right side of the law.
Key Takeaways
- Call compliance is non-negotiable in the insurance industry: It builds trust, avoids costly lawsuits and fines, and shields your brand from reputational harm.
- Frequent outbound calls mean higher risk: Insurance companies and those making insurance sales calls must be extra diligent when calling leads and clients.
- Technology is your ally: Solutions like Readymode help reduce compliance risks.
- Continuous education and vigilance are essential: Regulations evolve and change. Staying informed and training your team is just as important as having the right tools.
- Audit and document everything: From consent to call logs, good records are your best defense in the event of a complaint or lawsuit.
Why Insurance Agents Should Care About Call Compliance
1. Improve Client Trust
Insurance is an industry where trust is paramount. Clients rely on their agents not just for financial protection, but for transparency and integrity in every interaction. When compliance protocols are followed, clients feel secure knowing their personal information is respected and their preferences are honored.
Unsolicited or intrusive calls can erode this trust and drive prospects away. Demonstrating respect for regulations shows that your agency values client consent, privacy, and ethics, all of which are foundational to strong, long-term relationships.
2. Avoid Financial Damages and Legal Issues
The TCPA sets strict guidelines for telemarketing calls to clients. A single violating call can result in a damages award of up to $500, which can be increased to $1,500 if the violation is found to be willful. For those that make frequent outbound calls to leads and clients, the risk is significant.
Beyond those financial costs, lawsuits drain resources, distract from business growth, and can even threaten your ability to operate.
3. Protect Your Brand Reputation
News travels fast, so compliance missteps can damage your brand overnight. Lawsuits and investigations generate negative press, erode consumer confidence, and may prompt regulatory scrutiny across your entire business.
Even when cases are settled or dismissed, controversies can linger and impact your ability to attract new clients or partners. Being proactive about compliance not only helps you avoid penalties, but also safeguard your reputation.
Special Considerations for the Insurance Industry
The insurance industry faces unique challenges when it comes to call compliance:
- High Call Volume: Insurance agents often engage in frequent calls to leads, client follow-ups, renewals, and new policy offers. Each interaction raises the risk of a compliance breach.
- Sensitive Personal Data: Calls frequently involve the exchange of private client information. Compliance with privacy laws, alongside the TCPA, is essential.
- Third-Party Lead Generators: Many agencies rely on external partners for lead generation. Ensuring you only use vendors that follow compliance protocols is vital, as it is possible you may be held liable for their actions if they don’t.
- Complex Consent Rules: The insurance industry must navigate express written consent requirements, especially for robocalls and texts, and manage Do Not Call (DNC) lists with precision.
7 Tips & Strategies for Compliant Calls
As the regulatory landscape evolves, insurance agencies and lead generators can take proactive steps to reduce compliance risk:
1. Understand TCPA and Related Laws
Invest in regular compliance training for staff. Know the difference between informational calls, marketing calls, and robocalls, and understand what form of consent is required for each.
For example, making a marketing call that uses a prerecorded or artificial voice requires the called party’s prior express written consent. It’s also important to stay updated on federal, state, and local regulations, as rules can vary.
2. Maintain Accurate Records
Document all client consents, call logs, and opt-out requests. Retain proof of consent for automated calls and marketing/sales calls (even if they are live-agent calls) and keep records organized and accessible in case of audit or litigation.
3. Maintain Internal DNC Lists and Utilize the National DNC Registry and RND
Regularly update your own internal DNC list, scrub against the National Do Not Call (DNC) Registry, and consult the Reassigned Number Database (RND). Ensure your systems automatically suppress numbers marked as do-not-call, and immediately process any opt-out requests.
The current rule requires that opt-out requests be honored within a reasonable timeframe, not to exceed 10 business days. But the quicker you can honor such requests, the better.
4. Audit Lead Sources
Vet third-party lead generators to confirm their data collection and calling practices are TCPA compliant. Require contractual assurances (including indemnification) and conduct periodic audits.
5. Use Technology to Automate Compliance
Leverage compliance-focused software, such as Readymode, to automate call suppression, consent tracking, and record management. Readymode’s platform offers features designed specifically for high-volume call centers, helping agents stay compliant without sacrificing productivity, such as:
- Integrations to automate National DNC Registry scrubbing
- Consent record storage and retrieval
- Real-time call monitoring and reporting
- Internal DNC list management
6. Train and Educate Your Team
Make compliance part of your corporate culture. Hold regular workshops and refreshers, circulate updates when laws change, and empower agents to flag potential issues before they escalate.
7. Monitor for Changes
Regulations change frequently. Assign a compliance officer or team to track legislative developments and implement updates as needed.
Final Thoughts
As consumer expectations and regulatory scrutiny intensify, insurance professionals cannot afford to overlook call compliance. By making it a foundational priority—supported by robust training, diligent record-keeping, and smart technology—you can safeguard your business, your clients, and your reputation.
This article is only offered for informational purposes; it is not legal advice. Please consult a qualified attorney for your specific compliance needs.
Joe Bowser
Joe Bowser is a partner at Roth Jackson. He has been practicing communications and marketing law for two decades. He advises and defends calling and SMS platform providers (like Readymode), carriers/VoIP providers, and heavy users of those services in their wide range of compliance needs. In his spare time, you can find him taking his boys to their sports, getting in a workout of his own, or catching an Arsenal match.
