The Telephone Consumer Protection Act (TCPA) and the Insurance Industry

Fran Majidi August 30, 2022
tcpa insurance

Since 1991 marketers have been gnawing their fingernails and sweating bullets, feeling unsure about the right to cold call at whim like their predecessors once did with little to no consequence. Ah, the famous cold call has become criminalized, restricting telephone solicitations by hitting businesses in the wallet. To an insurance agent, being told they can no longer telemarket to clients is often similar to being told not to go to work. As early as October 2013, new FCC regulations went into effect making prior consent to phone calls and text messages mandatory. So, where do TCPA laws apply now and how can you protect yourself? The first thing you can do is find out what the laws are so you don’t find yourself stuck with hefty fines ($500 to $1500 per call or text). The bigger nightmare, however, is if you are hit with numerous consumer class action lawsuits. These days, there are easily downloadable apps that allow users to submit claims against cold callers within seconds of receiving an unwanted call, text or recording. Yes, not only are calls limited but so are SMS text messages, fax machines, and artificial or prerecorded voice messages.

The online lead generation industry is a $17 billion dollar industry, according to the Internet Advertising Revenue Report of 2012. Many lead generation companies have call centers that use autodialing for efficiency but which may conflict with TCPA laws. SmartFinancial, however, presents compliance language when customers fill out forms, giving consent to phone calls and texts.

What Is Required for Compliance with TCPA Laws?

It’s a good idea to get familiar with the laws and know that TCPA compliance is required even when it’s a third-party generated lead. You need to also have proof of the consent consumers have given to the third-party company. You must also have proof of consent with each channel. Speak with your lead generation companies to get persuasive proof.

Unfortunately, many insurance agents still think that the TCPA compliance laws don’t pertain to them or they don’t think they are in threat of being litigated. The truth is that insurance agents need to be concerned. Between July 2015 and the end of 2016, the number of TCPA cases has grown by over 46%. Damages and penalties are also on the rise in more recent years. However, these issues don’t apply only to insurance agents but any business that deals with phone calls, texts and faxes.

Another misconception is that new clients or prospects are the ones submitting claims, but there are many instances of long-time clients complaining about calls, texts and faxes during servicing). That is why it’s important for you to have clear consent about using any and all means of communication. If you only have an okay for emails and send a text, you could easily be penalized with a fine.

What Can I Do to Prevent Claims of TCPA Non-compliance?

Make sure that your lead generation companies not only have clear and prominently placed consent language so that consumers are aware that they are giving consent to be called/texted. Keep tabs on consumers who revoke consent and make sure they are no longer being contacted.

Remember that as a marketer, you will have the burden of proving that a clear disclosure was provided by you or any third-party lead generator. It’s also recommended that you keep each customer’s written consent for 5 years. For instance, if these phone numbers were generated with a form, the form must have visible and clearly written consent information. It’s also advised that you gather the consumer’s computer IP address.

What Happens if I’m Non-compliant with TCPA Laws?

The cost of being non-compliant is high, especially if you’re a repeat offender. Going to court alone can cost thousands of dollars. There’s also no way to quantify how your status may affect your reputation. Plus, if a class-action suit is brought against you or your agency, your penalty could cost millions of dollars. As for the range of fees for non-compliant calls, they start at $500 and usually max at $1500 even though the judge may allow additional damages and fees. The biggest hurdle is that these numbers add up, especially for agencies with campaigns of thousands or millions of calls/texts. All you need is a visible and clear form of consent to stay compliant. If a case goes into litigation, courts must determine if the defendant “willfully” or “knowingly” violated the TCPA.

Don’t just assume you’re being compliant if your lead source has not given you documentation on how they comply with TCPA laws. You will also need this information if your case does go to court. TCPA settlements are not fun.

How Being Compliant with TCPA Makes Sense

If people are complaining and filing claims against you, they are not having a very positive customer experience, are they? Here’s where compliance comes into play again. The whole point of TCPA is to mitigate compliance risk and avoid litigation. It’s important to keep tabs on your sales, marketing and even legal teams to avoid any mishaps. The laws surrounding TCPA are to ensure that you have the right strategy in place so you can avoid litigation. Both the cost and risk of litigation are high.

If your agency makes thousands of calls each day, it makes documenting the customer’s compliance even more challenging. There are helpful solutions, like the Trustedform Solution, which verifies the origin of Internet leads. However, if you’re working with a company like SmartFinancial, your leads are already TCPA compliant. You’ll just need to document that the leads you’re calling or texting originated with that specific company.

General provisions of TCPA

  • If a consumer has given a phone number to a creditor for use in normal business communications, it’s considered consent.
  • TCPA restricts telemarketing and advertisements via telephone call before 8 am or after 9 pm.
  • TCPA restricts calls made to telephone numbers on the national do-not-call (DNC) list.  
  • Whenever a consumer gives his/her phone number on a website requesting car insurance quotes or whatever it may be, this is considered implied consent.

Exemptions Include

  • Calls made manually and do not contain a pre-recorded message.
  • Calls made regarding emergencies.
  • Calls that are not commercial in nature.
  • Calls made for commercial reasons but do not include advertising and are not considered telemarketing calls.
  • Calls made by or on behalf of tax-exempt nonprofit organizations.
  • Calls with a health care message made by or on behalf of a “covered entity” or “business associate” of the covered entity are exempt from TCPA laws but must follow the HIPAA privacy rule.
  • Calls made unknowingly to a wireless number that’s been ported from wireline service and is a voice call (not pre-recorded).
  • Calls that are only intended to give information.
  • Research and survey calls and bank account fraud alerts are exempt from TCPA.


  • Unanswered telemarketing calls must be disconnect after at least 15 seconds or 4 rings.

Pre-recorded Telephone Messages or Artificial Calls of Any Kind

  • The message must clearly state the name of business, individual or entity at the beginning of the message.
  • The message must clearly state the phone number of business, individual or entity (not the auto-dialer number and not the number of the prerecorded message that made the call.)
  • There should also be an automated voice or keyboard based way of opting out of the calls and getting placed on a do-not-call (DNC) list.

In Contacting Leads, What if I Call out-of-state Regularly?

You are responsible to follow the laws of both states when you make an interstate call. For intrastate calls, if the state law is weaker than the federal law, you must comply with the federal law and vice versa.

What About B2B Calls?

Businesses to business calls are not covered under the TSR or TCPA.