Hey Youngbull,
I am the guy who trains IKO Instructors in Australia and most of South East Asia. I have run more than 25 courses over 4 years and have trained over 150 instructors in that time both here and overseas and have learned a lot in that time.

You cannot become an IKO Instructor in 3 days, it's impossible and has never happened.
In order to take an IKO instructors course you must comply with the prerequisites first which are :
1/ minimum 6 months kiting experience at Level 3 (ride upwind, jump, gybe in a variety of conditions etc)
2/ Minimum 18 Y.O.
3/ Have a valid First Aid training certificate
4/ Have a current Boat drivers license
5/ Have previous teaching experience preferably in a water or air sport or have completed IKO assistant instructor training.
Once you have the prerequisites you can do the 5 day course (40 hrs) to learn how to teach and handle people as well as learn all of the intricacies of weather, water, teaching psychology, law, school setup, boat rescue procedures etc etc. and you must pass a written exam at the end of the course as well as practical exam. It is not a certain to pass the course straight up, as many will attest.
I have trained people who were expert kiters who made the worst instructors, and have also trained people barely fitting the riding criteria who were absolutely amazing instructors. And also everything in between.
A level 1 instructor is an instructor with "L Plates on", ie. still learning the ropes and gaining experience. An instructor is only of real experience and worth once they acheive Level 2, which is after having taught 160 hrs worth of lessons (80 lessons) to a maximum 40 students and receiving positive feedback from all those students.
A Level 2 Senior instructor has taught more than 1000 hrs of lessons with positive responses. These are seasoned veteran instructors who usually manage or run schools and love to teach. In my experience, they are not the best kiteboarders, they are solid, but they are excellent instructors. There are only about 3 or 4 in all of Australia.
I hope this goes some way as to explaining the value of proper training and as to why insurance companies and councils need this minimum requirement.
Good winds,