Product Validation tools for Best Interest standards and Regulations
CapitalROCK uses the RightBRIDGE AI engine to determine the suitability of proposed products and accounts. RightBRIDGE uses a product validation process to determine suitability and provides a well-documented procedure to achieve compliance under state and federal regulations. CapitalRock is currently working on a version of it’s validation tools for the SEC Reg BI. The process used for product validation under Reg BI will follow the same process as the current product validation tools with the following steps:
Validation Tools for New York Reg. 187
The RightBRIDGE Life Insurance and Annuity Validation Tools use an artificial intelligence engine to determine the suitability of a proposed or in-force policy in regulated states such as New York, Pennsylvania and Vermont. The solution supports new sales, replacements or changes to an existing policy.
Product Validation Tools for Reg BI
CapitalROCK has been on the forefront of helping financial firms manage the increased regulatory requirements of both federal and state regulations. The white paper below will outline how the RightBRIDGE Product Profiler will be modified and adapted for SEC Reg BI.
How Does RightBRIDGE Product Validation Work?
The RightBridge engine is configured to validate that a product meets the requirements defined in Reg 187 and other state regulations. Each factor and its weighting combine to create a score that either confirms a client’s best interests or determines that the standard has not been met. The configuration settings in the RightBridge system can allow each product type to have product-specific suitability rules.
Reg 187 Life Insurance Validation Tool
Step One - Data Collection
The RightBridge Life Insurance Validation Tool collects the following data:
State of Issue
Validation Type – New Policy, Change to Existing Policy, Replacement Policy
Product(s) to be validated from drop down list of products
Life Insurance Needs based on financial objective of the policy owner
Other state regulated data elements
Step 2 - Validation
The data collected in the questionnaire creates a case which is run through the RightBridge scoring engine and determines through a set of configured suitability rules whether the transaction meets the best interest standard, needs further review, or is not a best interest transaction.
Case Results include the following:
Overall Validation Score (0-100)
Overall Validation status/color (Red, Yellow, Green)
Individual checks of the 13 Data points in the regulation
ReasonText™ supporting and explaining the status of the checks
Scores for each ReasonText™ element
Color indicator for each ReasonText™ element
PDF report containing all the above information and a summary of the case.
Back Office Dashboard
Back office users are provided with a dashboard that summarizes all suitability reviews submitted to the RightBridge Reg 187 application. This application will provide back office and supervisory users the ability to see cases that have been submitted.
When a user logs in the dashboard they are presented with a summary of the case activity and summarized results based on where they fit into the user hierarchy (Firm ,General Agency, Unit, Advisor, Rep Code ).