Question: Affiliated agents, such as career and captive agents, numbered around 158,200 in 2013, down from the 40-year high of 256,735 in 1973, according to LIMRA. What does this decline mean for the future of life insurance and annuity distribution?
“We are hopefully reaching people in different forms than through touch or calling, as was the dominant industry approach in the past. For instance, we are using technology — such as social media, internet leads and analytics — to reach more people with fewer people. Analytics can help with predictive modeling so that we can see who would be a prospect for a product before we ever contact the person. We’ve been using analytics for 1.5 years to help generate leads at our company, and that has increased our production in life insurance, annuities and property-casualty insurance by over $1 million in premium. For sales, we use employed and captive distribution.”
--Darrell McNeal, Alfa Insurance Company, Atlanta, Ga.
“That 40-year period is the one in which continuing education, compliance and the aging population became factors in the industry. During that time, a lot of agents left their captive companies and moved into independent brokerage. They did that so they could have access to more products, which the brokerages made available. No one saw the decline coming, and one expected agents to leave the captive channel to get products. Today, however, virtually all companies give agents access to the full spectrum of products. That includes the captive carriers, which have leveraged computers, the open architecture product environment and various services to do that. At the same time, agents in the independent channel are looking for more training. As a result, I think the industry is entering a new period for distribution. I think the traditional captive companies see the changes in brokerage, including the gradual decline in brokerage market share for industrywide life production in recent years. As a result, the captives will want to bring agents into the business again. My company works on training with 25 to 40 companies, and this is what we keep hearing: ‘How do we recruit, and how can we provide the training the recruits need?’ For those reasons, I’m bullish on what’s going on in the industry.”
--Harry Hoopis, chief executive officer, Hoopis Performance Network, Chicago
“We need to change the way we recruit and retain talent. We have an aging population, and so in order to grow the channel and the business, we need to do a better job of attracting young talent. Also, something that is important to the future of the captive channel is that they have to be more productive. The companies have been reducing cost by reducing headcount, so now the industry has to find ways to make the channel more productive.”
--Matthew Winkelman, assistant vice president, learning and development, MetLife, Charlotte, N.C.