The new Sales of Insurance regulation states that you must identify areas where insurance sales activities occur and clearly delineate and distinguish those areas from the areas where retail deposit taking activities occur. The regulation does not clarify this issue, and the ABIA/ABA Q&A just states signage may be used. In several cases, we have FSAs that accept deposits and also will take loans at the same desk in the platform area. We have an FDIC sign at those desks. If we put another sign on the same desk for credit insurance sales that are NOT A DEPOSIT, NOT FDIC-INSURED, etc., won't this be confusing to consumers. Any suggestions from the audience on how you will be handling this situation. Thank you and just as confused as consumers will be with this new regulatory burden.

We also have financial consultants who wear both "hats" and sell insurance products as well as open accounts for clients. We have designated a specific desk in each branch that has the requisite "not-not-may" signage, and that is where the insurance sales must take place. I know it seems silly to ask the client to move, but it is the only way we could stay in compliance with the laws and not confuse the customer. The physical act of moving to another location for the insurance discussion probably helps drive home the importance of the seapration, and helps the customer to understand the fact that these products are different from the ones they just opened.
Leslie

We also have platform staff who take deposits and loan applications at the same desk. My interpretation of the rules and the letter was that consideration may be made for this kind of physical configuration as long as the area where the loan applications are taken is separate from the teller line. We were not planning to have a specially designated desk for loan applications. Am I wrong on this? I have SUCH a headache . . .!!

This is really a problem in small offices, such as supermarket branches, where there is only one desk (or table.) The agencies have accepted clear signage as a method of distinguishing the functions. Some branch managers or sales reps take off the FDIC sign and put up the non-not-may sign. This way they stay at the same table, but send the message. So far, that has been ok with examiners. The key is to make sure that all of your people are well trained and understand what they must do and why they must do it.

Lucy, Do you think it is necessary for a bank representative to remove the FDIC sign when they initiate a conversation about insurance sales? I would be afraid they would forget to put the FDIC sign back in place. We don't have enough room to utilize a separate desk--and now even our CSRs are licensed to sell insurance! (You know, the same ones I can't train to properly place a Reg CC hold.)

I recently spoke with our regulator (OTS) and told them the dilemma about some staff having double-duty with both opening deposit accounts and taking consumer loan applications where credit insurance is offered. I stated that all staff that open deposit accounts have the FDIC sign at their desk and that I wanted to have another sign with the NOT, NOT, NOT, NOT placed at the same desk (since separate desks not always available). The verbiage would state "Credit Life or Disability Insurance Offered Is: NOT, NOT, NOT, NOT." The regulator did not seem to have a problem with this, just as long as the insurance activities are not taking place at the teller line. Of course the response could be different from regulator to regulator and examiner to examiner--as every regulation is. It probably would be a good idea to check with your regulator regarding the approach you intend to follow to see if it passes their scrutiny.

Sorry for the delay in posting, but it has been a strange day in the Washington area...

As for the FDIC sign, I think the first choice is to take it down or cover it up. However, this is not always possible. You aren't expected to get out a spatula and scrape stickers off of walls. If you have a sign that is permanently affixed, then the sales rep should take extra care to call the customer's attention to the not-not-may and be sure the customer understands that the FDIC sign does not apply to this product. The most important thing to emphasize here is training. Be sure the sales staff knows what to do and that they do it.