The Proliferation of Social Media – And How to Manage Your Risks

Social media compliance: these three words can strike fear into the heart of any insurance agent in the financial industry. At its most basic, social media compliance simply means following the rules when using social media to engage with the public.

As technology continues to advance, social media platforms have become an integral part of an insurance agent’s marketing efforts. And unless you’ve been hiding under a rock, you probably know that these days, the world-wide-web is where it’s at. For insurance professionals, it’s a great way to gain access to people directly, even without a large advertising or marketing budget. However, social media advertising can be just as difficult, if not more so, as traditional marketing because of the additional compliance requirements involved.

As you already know, insurance agents must follow state advertising regulations when marketing and advertising online. While the Internet may seem like the Wild, Wild West, you still have to follow the same rules and standards that you’d normally be expected to comply with for more traditional forms of advertising.

And this is no time to take short cuts when it comes to compliance. This new era of online marketing actually increases your risks. Social Media content is more likely to be viewed, printed off, forwarded, re-tweeted, and shared, not only by consumers but by regulators and plaintiff attorneys, all at just the click of a button. It essentially becomes documentation that can be used for or against you during a complaint or regulatory enforcement action.

If you’re new to social media or perhaps you want to know more about what you can and can’t do, make sure you understand your exposure and take steps to minimize your risks. Your best defense is to make sure your advertising – especially your social media advertising – is reviewed and approved by a qualified compliance professional who understands your business and the rules.

In the meantime, here are a few tips to help you get started:

  • Don’t use false or misleading header information
  • Don’t discuss specific products or investments
  • Don’t respond to third parties with advice or recommendations
  • Don’t use inflammatory, exaggerated or promissory copy
  • Include relevant disclosure - even when there are word count restrictions
  • Disclose accurately who you are and what you offer – don’t exaggerate here
  • Tell recipients how to opt-out of receiving future emails from you
  • Honor opt-out requests promptly
  • Utilize a platform that allows for content archiving and compliance controls
  • Develop and follow a defined social media policy that outlines the types of content you will post, where and how often, how you’ll manage third party posts, archiving processes, and more. Don’t worry, your compliance partner can help you create and manage this process!

As you can see, social media compliance is hardly simple. The rules are a complicated mix of industry regulations and federal, state, and local laws. So if you’re going to use social media, you need to understand your compliance obligations. Learn more about how compliance can protect you and your business by contacting us today at 800-322-6384.

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Maureen James - Co-owner/Principal at Summit Compliance Group, LLC

Experienced Compliance Professional with a demonstrated history of working in the insurance industry. Skilled in Securities, Disability Insurance, Retirement Planning, Fixed Annuities, and Management. Strong entrepreneurship professional. Summit Compliance is a proud DMI Marketing partner.

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