The company with the largest life insurance sales force in the U.S. says the licensing test for insurance agents is too tough so it is asking state regulators to ease the test.
The problem for Primerica Inc. is that of the 230,000 people it recruited last year, just 20% become agents, with the remainder mostly failing their state’s licensing exam, according to a Wall Street Journal article.
The insurer said some state tests are too hard, and others might be racially biased, meaning African-Americans and others have a harder time passing, according to the article.
Among Primerica’s recruiting requirements are that individuals be free of a criminal record and that they pay $99 for licensing and training costs.
Since 2006, more than 900,000 people were recruited by the insurer, which, according to the article, is 43 times more than are recruited by New York Life Insurance Co., one of the largest insurers in the U.S.
A California Insurance Department representative told the Wall Street Journal that Primerica recruits’ failure rates lowered the overall pass rate in the state from 73% to 58%, between April 2010 and September 2010.
In Virginia, Primerica’s 825 recruits had a 38% pass rate between June 2008 and June 2010, while other training programs’ test takers had pass rates of between 51% and 83%, a representative of the Virginia State Corporation Commission Bureau of Insurance told the newspaper.
Life insurer wants states to ease insurance agent licensing exams via IFAwebnews .