Where Are The Next-Gen Producers?
By Linda Koco
NEW YORK CITY -- Attracting younger producers, in generations X and Y, will require a different mindset than the insurance and financial industry has used in the past, according to an executive who heads up insurance services for independent advisors and financial institutions for his firm.
“We will need to go out there and adopt their mindset rather than think about who we are and how will they fit with us,” said Todd Tharp during a closing workshop at LIMRA’s annual meeting here.
New recruits will be more diverse than the people who are currently running service businesses and industries that support producers, said the senior vice president and head of insurance services at LPL Financial Services. “That diversity will reflect the markets we are in.”
Younger producers who are already in the industry are very different from older producers, Tharp said. “They don’t think like us, don’t want to be like us and they don’t want to operate like us. They have a really different value set.”
That means those who are supporting the producers, and recruiting younger producers, need to think about how they interact with younger producers. Often the younger producers are talking to producers who are a generation older than they are, he pointed out.
He and other panelists had been asked to comment on a number of questions about distribution and advisor trends, including where producers of the future will come from.
The producer question
The producer question has gained currency in recent years because studies from LIMRA and other researchers have spotlighted the continued aging of the advisor ranks. That has raised concern that there may not be enough new, younger producers entering the business to offset the decline that will occur as older advisors retire.
Tharp pointed out that advisors at his firm aren't insurance people first. Rather, they offer insurance solutions along with investment programs and related planning activities.
The young producers are coming into a world of doom-and-gloom, Tharp said. They are therefore looking for something to attach to that provides information and transparency, he said.
“They won’t attach blindly, with trust,” to entities asking them to participate in integrating, relating and connecting across the markets they serve. So, the industry will need to go out and look for individuals who can do that, but approach them with the mindset of the younger generation, he maintained.
Mark A. Wilkerson, senior vice president-individual division, OneAmerica Financial Partners, predicted that the younger producers “will come from where they always come from.” That is, from training, effort and hard work.
The opportunity in the insurance business is “as big today as it was when I started out,” he said.
“Everybody wants equal opportunity “but now we are finding people want equal success” too, he added. But success in business is no different now than it ever was, “if you’re willing to work at it,” he contended.
Wilkerson recalled a LIMRA survey of college students. When told of a job that would let them run their own schedules, make a difference, have teamwork and enjoy similar desirable attributes, “everybody said, ‘that’s the job I want,’” he said. But when they opened up the paper and saw the job entailed selling life insurance, “no one wanted it,” he said.
Wilkerson maintained that the opportunity exists, in insurance sales, to have all of those things. But he said it is up to managers to create an environment where recruits can “get the training they need and get people to sit with them and hold them accountable to do the work.”
To underscore the point, he told how he started out in a group of five recruits. Right away, he said, he knew that three of the five would never make it -- because they did not do the work. By contrast, those who did put effort into the job did make it, he added.
Clients will be a factor
Will H. Fuller, president and CEO, Lincoln Financial Distributors, says he thinks that new producers will come from “where the clients are and where they want to be served.”
There are multiple ways that clients say they want to access insurance advice, he noted. These include advice through a dedicated insurance agent or primary wealth management relationship.
“That dynamic will be the driving force for determining where producers will come from,” Fuller said.
He gave kudos to the captive/career agency system, saying it has played a “vital role” in the industry, alluding to its history of attracting and training new producers. “I am a product of it … as are others in this room,” he added, predicting it will continue to be a major force.
But Fuller also said other financial institutions will play a role, too, especially as they respond to the need to serve the total wellbeing of their clients.
Over time, he predicted, “we’ll have multiple approaches to how we build the distribution forces.”
As for technology, it will be a player, he said, “but it won’t replace the advice and guidance of one specialist to a consumer.”