Making The Transition To Worksite Sales

Making The Transition To Worksite Sales

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“I never heard of worksite marketing before 1998,” says Lawrence Prichard.

Now a managing general agent in Dayton, Ohio, for Colonial Supplemental Insurance, this former property-casualty producer says he is glad he finally did learn about worksite products and started to sell them. Now, he says, “my commissions are 75% higher than they were four years ago when I was a district manager for a p-c shop.”

Prichard is not alone. Around the country, professionals from other financial sectors are increasingly seeing the worksite sales opportunities and jumping in. This article tells how some of them decided to transition into the field and what the outcomes have been.

Worksite products are sold to employees at their place of business at a discount. Also called voluntary insurance, payroll deduction insurance, and even salary allotment plans, they include life, accidental death and dismemberment, health, disability, long term care, vision, dental, critical illness, cancer policies and many others.

Certain products–like worksite universal life insurance–have been available for decades. But with the recession, sales have picked up (see chart) and the product lines have expanded to include a full menu of options. Those developments, combined with trends in the newcomers own fields, helped trigger the transitional moves.

It should be noted that not all producers have had an easy go of worksite sales. “In my own experience, I have a psychological barrier to the market,” points out Milton Jones, principal for Insurance Plus in Fayetteville, Ark. “It is hard to get certain employers to let you in to talk with the employees, unless you have the companys group insurance account or something else.”

Others, however, have a much different story to tell. Consider:

Wayne Morris, a broker with Life of the South Agency Inc. in Atlanta, transitioned from group health sales to voluntary products, especially the voluntary disability income policies of Massachusetts Mutual. His very first enrollment, at an architectural firm, drew an enrollment of nearly 36%, and he says, “I thought it was great!”
Tye Elliott, now a regional sales coordinator with AFLAC, based in St. Louis, Mo., left a career in life insurance and investment sales seven years ago to start selling worksite products. “The idea was to use the worksite sale as a door opener to sales of the individual products,” he recalls. But after selling his third worksite case and getting enrollments of over 50%, he decided to cross over. Today, his earnings are “far better” than they ever were in any pre-worksite year.
Lisa Perri, principal of LP Financial Inc. in Cherry Hill, N.J., and a sales representative for Colonial, transitioned to worksite in 1999 from a full-line p-c agency. When she first heard about worksite, “I thought it was a brand-new concept,” she says. But she loved the idea of group sales, so she researched the market carefully and then decided to work it into what she was already doing. Six months later, she left the p-c agency and went at worksite full-time. “It was amazing,” she recalls. “In my first full year, I made more money in voluntary than I did in any of my p-c years.”
David Morningstar, a producer and regional sales coordinator with AFLAC, based in Baltimore, Md., transitioned into the field in 1996. He left a go-go job as a stockbroker at the height of the 1990s bull market. At the time, some of his peers told him he was “crazy” to leave a “hip” job for a “nickel-and-dime” business like worksite selling. But today, he says, many stockbrokers he knows arent making any money. Meanwhile, “I am making a lot more than I ever did as a stockbroker, and the business is very steady, too.”

What turned the dial for these producers? Simply put, they compared their perceived future opportunities in their existing field with prospects for greater opportunity in worksite sales.

“It was a big jump for me,” recalls Prichard, explaining that it sounded as if the market involved a totally different kind of sell and marketing. Like Morningstar, he encountered associates who wanted to know what was wrong with him. “Youll be leaving a good job,” they warned.

But he concluded that “the handwriting was on the wall in the p-c business. I could see it (the hard p-c market) was going to get worse before it got better.” There was a lot of price-shopping going on, and much of the work felt to him like order-taking.

What got him to look at worksite? It was a call from a Colonial vice president. The ensuing discussions led him to learn about the market, its growth potential, training opportunities and more. Prichard liked what he heard and was especially interested in the creativity involved in the two-step selling approach (sell the employer on the value and the employees on the need and the product).

He did his research but in the end, he says, the decision came down to this: “If you want new opportunity and have confidence in yourself, you should try this.”

That view resonates with Morningstar. “I was willing to fail,” he says of his own decision to change fields.

Besides, he says, “sales are all about markets, and markets change. They are dynamic. If you find yourself in a bad market, my feeling is, maybe you need to switch markets.”

In his particular case, the market he had been in was investment products. Even though the bull market was raging in the 1990s, he says he could see that the earnings capacity of the average broker was dropping due to smaller commission levels. “I could see that, once the bull market ended, the commissions would be a fraction of what they were before. Meanwhile, more and more people were shopping on the Internet and investing on their own.”