Insurance Distribution On The Move
Insurance distribution is definitely a work in progress. Take a look at these snapshots gleaned from various LIMRA reports, in advance of LIMRA’s 2014 Distribution Conference:
· Independent agents have led individual life annualized premium production for more than a decade, earning a market share at or above 50 percent in most years from 1999-2012. Market share reached a high of 56 percent in 2007-2008 but then dropped back to the 49 percent range from 2009-2012. (This channel includes brokerage, personal producing general agent and stockbroker/wirehouse firms.)
· Affiliated agents rank second in individual life production with a market share slightly above or below 40 percent from 1999-2012. (This channel includes the agency-building sales force, multiline exclusive agents and home service agents.)
· Distributors such as financial institutions and worksite marketers have earned a life production market share in the neighborhood of 5 percent over the same period, but from 2010-2012, they grew their share to 7 percent.
· Market share for direct distributors has hovered at or below 4 percent in all 13 years.
· Affiliated agents numbered an estimated 158,200 in 2013 — down 38 percent from the 40-year high of 256,735 in 1973.
· Affiliated recruits numbered an estimated 35,000 in 2013 — down nearly 94 percent from the high of 54,736 in 1975.
· Over the last 48 years, the career advisor channel has steadily increased the percentage of women among recruits. In 1965, women represented just 2 percent of all recruits in this channel, but by 1985, they represented 20 percent. By 2013, women represented 31 percent of recruits.
· The percentage of advisors who team with others has increased 8 percent since 2008. Today, one in five advisors said they team with at least one other advisor and share more than 20 percent of their revenue.
· Forty-three percent of today’s advisors specialize by client segment, typically by affluence or occupation.
· Fifteen percent of advisors who provide their clients with a retirement plan are more productive, but most advisors today still do not provide such plans.
· An agent in the multiple-line exclusive-agent (MLEA) distribution channel has, on average, 1,480 clients, 50 percent of whom buy only auto and home insurance from the agent.
· Since 2008, life insurance sales by MLEAs have grown by almost 10 percent.
· In the MLEA channel, nearly half of the agents are age 50 or older.
Source: Data gleaned from various research reports published by LIMRA in the past few years.
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