Agent Count Falls at Bankers Life

Agent pruning and lower unemployment may be factors in the falling agent count at Bankers Life, said CNO Financial CEO Gary C. Bhojwani.

“Look, any macro trends in the employment market impact us,” Bhojwani said in a conference call with analysts.

Commission-only agents who file as contractor are more open to a career change when the unemployment rate is at 8 percent, he said.

The 4.1 percent unemployment rate is the lowest in 17 years and comes at a time when Bankers Life is reshaping its agency system.

Bankers Life, a subsidiary of CNO, distributes insurance and retirement products to middle-income Americans through career agents.

In the first quarter, average producing agents with three or more years of experience fell by 16 to 1,847 agents compared with the fourth quarter, the company said.

Average producing agent count with three years or more fell 2 percent compared to the year-ago quarter, the company said.

“Maybe two or three of those 16 folks are driven because of that (lower unemployment) but I wouldn’t be able to say that all of them are driven because of that,” Bhojwani said.

Bankers Life wants to recast its agency force by recruiting experienced agents and teach them to sell other company products rather than churn through thousands of recruits only to end up with a few hundred after several years.

Longer term, competition for middle market buyers isn’t as crowded as it is for other segments and insurance agents are embracing the new opportunities that a securities-licensed professional offers, Bhojwani said.

Pockets of Promise

Pilot programs may not be moving fast enough for Bhojwani, but “pockets of encouragement on the sales front abound,” he said.

At Washington National, another CNO subsidiary, agents are selling new product lines like short-term care.

"We are seeing some tailwinds in terms of the ability to cross sell our products and grow our franchises within operations like Washington National," Bhojwani said.

Washington National distributes supplemental health and life insurance products through independent insurance agencies.

First quarter average producing agents with three years or more rose by 2 to 316 agents compared to the fourth quarter.

There were 308 average producing agents at the company in the first quarter of last year, the company said.

First quarter Web-based and digital sales also rose at CNO’s direct-to-consumer brand Colonial Penn, Bhojwani said.

CNO Meets Earnings Forecast

CNO Financial reported first-quarter net income of $84.3 million.

On a per-share basis, the Carmel, Indiana-based company said it had profit of 50 cents.
Earnings, adjusted for non-recurring gains, came to 44 cents per share.

The results met Wall Street expectations. The average estimate of three analysts surveyed by Zacks Investment Research was also for earnings of 44 cents per share.

The insurance holding company posted revenue of $1.01 billion in the period.

InsuranceNewsNet Senior Writer Cyril Tuohy has covered the financial services industry for more than 15 years. Cyril may be reached at [email protected].

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Cyril Tuohy is a writer based in Pennsylvania. He has covered the financial services industry for more than 15 years. He can be reached at [email protected].