Summary
How will consumers find their way through the maze that is life insurance? Who will survive and be ready to capture market share?
Analysis
Where do we go from here? This is a product line that needs to be sold. Its products are sold in a consultive manner and they are not bought. So the importance of recruiting and training new life insurance professionals is key. This number according to "LIMRA" has continued to decline through the 80's, 90's, and into this decade. Where as today the retention rates are below 10%.
Traditionally the Career Distribution systems not only built their own sales organizations but they also supplied the bank and independent systems with recruits when their agents either failed or out grew the system. The independent channels have been the big winners during this time as they have been successfully picking off the Career agents, but those days are coming to an end. With fewer agents in the system, all the various distribution outlets that feed on agents moving around, are in danger.
The reason for the failure these last three decades is because of the difficulty agents have today in setting appointments or getting to the prospects. With tougher laws on telemarketing, agents need systems that will put willing buyers in front of them on a favorable basis.
So the future now belongs to those organizations both Career and others that commit to helping their producers to create a marketing program (lead generation) that will insure and consistent flow of fresh prospects. This is being done today on a small scale in some companies but the ones who do it right will be able to sell very profitable products with high margins and will enjoy tremendous agent loyalty.
So the future is to those who crack the lead generation code. It can come from any of the current distribution systems but the banks and Career systems have an advantage with their massive client databases. But watch the independents their entrepreneurial make up could prove interesting.
This author consults with leading institutions through GLG
Analyses are solely the work of the authors and have not been edited or endorsed by GLG.
