The Conning study, “Life Distribution Goes Independent,” reports that not only have the independents captured the lion’s share of sales in life insurance, insurers now are scrambling to distribute their products through agreements with banks, which only a few years ago insurers viewed as competitors.
“If you had told me a decade ago that traditional life insurers would be wooing the wire houses and banks as principal distribution channels, I would have said you’re crazy,” says George McKeon, assistant vice president at Conning and author of the study. “In spite of the millions of dollars spent on developing the Internet as a distribution channel, actual sales [on the Internet] have been elusive, largely because the age-old wisdom that ?Life insurance is sold, not bought,’ continues to be proven true. The big change has been that consumers want an advisor who isn’t tied to one carrier. They want an advisor who can understand their issues and can select from a variety of solutions. You might say that in life insurance, manufacturing is finally listening to sales, rather than the other way around.”