The Outsourced Insurance Desk: A tool for achieving better client outcomes

In this interview, Jeff Waddington, National Sales Director at Protective, encourages you to consider an outsourced insurance desk and how it can help you better serve clients — especially as their needs evolve.

Jeff Waddington believes outsourced insurance desks (OIDs) are exactly what full-service advisors need to ensure their clients are protected for life. While OIDs have been around for years, they are now becoming more important as distribution firms evolve to serve the needs of today’s advisors.

As securing income for life becomes increasingly important, advisors who provide comprehensive financial planning to their clients cannot overlook the need for insurance products in the portfolio. However, without the proper licenses or understanding of these products, providing clients this coverage might require advisors to refer business away from their firm.

That’s where the OID comes in. An outsourced insurance desk can give BGAs and IMOs a way to provide comprehensive advisors access to products and expertise on life insurance and annuities so they can more easily incorporate these much-needed solutions in their clients’ overall financial plans.

The National Sales Director at Protective, Waddington has worked with many BGAs and IMOs to design and establish their own OID to serve financial advisors in their networks while simultaneously achieving wider adoption of life insurance and annuity products in the advisory channel.

In this interview, Waddington explains what an OID is and how it can enhance an advisory practice and enable financial advisors to continue to meet the evolving needs of their clients.

What makes OIDs so important for today’s advisor?

As everyone knows, the insurance world is constantly evolving. It’s progressing demographically, and the regulatory environment is constantly changing. Many clients today are choosing to do business with true fee-based advisors, and they are looking for that arrangement for all their financial products and for their entire financial life. For an advisor acting in a fiduciary capacity, providing advice related to risk management products may lead to improved client outcomes. The OID gives the advisor the resources and expertise they need.

Now would probably be a good time to ask you to define an outsourced insurance desk, or OID, for those who are unaware.

An OID, at its core, allows an advisor to access products and expertise in the risk management or insurance world when appropriate for their clients. This is important from the advisory perspective because in many cases, the fee-only advisor may not have the requisite license to provide insurance solutions or have these conversations with clients. The OID, with the expertise and proper license, can become the risk management arm of the advisory firm that advisors can leverage to benefit their clients.

Which insurance carriers are participating on this platform?

Not every product manufacturer is going to be represented in this marketplace. The key is whether the carrier has the technology infrastructure to manufacture a true fee-based product.
Some product manufacturers are using what I call the “direct OID,” which is the insurance company using its own licensed professionals to provide this service.

A “third-party OID” is also an option, which is what Protective currently utilizes. The advantage, in my opinion, is that it’s a purely independent firm. It’s not focused on one product or company. You have a variety of “flavors” available to you that span the entire marketplace.

What products and services are available through an OID today?

The independent OID has a wide range of expertise that includes products but also concepts. They understand how best to use the products to generate ideal client outcomes. That could be with annuities; income planning; other insurance, such as using life insurance for estate planning; efficient tax planning with insurance products; providing for long-term care needs; and possibly more. The OID offers services that span multiple areas using insurance for risk management.

How do OIDs fit into Protective’s overarching mission to protect more people?

Ultimately, what we’re striving to do at Protective is give clients better outcomes regardless of market volatility, the cost of living a long life or any other factor that could pose a threat to the vision they have of their financial life. With an OID, advisors and their clients are being given the means to create better outcomes with access to risk management insurance products — for the right clients in the right situations in any stage of life. Whether you’re talking about guaranteed income, a legacy plan, preparing for the cost of living longer or whatever else might be important in a client’s life, the name of the game is protection.

We’re always asking, what’s the best possible client outcome we can achieve? I believe OIDs play a part in finding the answer.

Click here to see how you can tailor your clients’ financial plan to their unique retirement needs with Protective’s fee-based variable annuity.

Jeff Waddington is a registered representative of Investment Distributors, Inc., a Registered Broker/Dealer, member FINRA and wholly owned subsidiary of Protective Life Corporation.

Protective® is a registered trademark of Protective Life Insurance Company. The Protective trademarks logos and service marks are property of Protective Life Insurance Company and are protected by copyright, trademark, and/or other proprietary rights and laws.

Protective refers to Protective Life Insurance Company (PLICO) and its affiliates, including Protective Life and Annuity Insurance Company (PLAIC). PLICO, founded in 1907, is located in Nashville, TN, and is licensed in all states excluding New York. PLAIC is located in Birmingham, AL, and is licensed in New York. Product availability and features may vary by state. Each company is solely responsible for the financial obligations accruing under the products it issues. Product guarantees are backed by the financial strength and claims paying ability of the issuing company. Securities offered by Investment Distributors, Inc. (IDI) the principal underwriter for registered products issued by PLICO and PLAIC, its affiliates. IDI is located in Birmingham, Alabama. Insurance and Annuities are: Not a Deposit | Not Insured by any Federal Government Agency | Have no Bank or Credit Union Guarantee | Not FDIC/NCUA Insured | May Lose Value