Most Worksite Reps Earn Over $100,000, Study Finds
About 54% of sales representatives selling worksite insurance and investment products through brokers typically earn between $100,000 and $199,999, including incentive pay, according to a new study by Eastbridge Consulting Group Inc., Avon, Conn.
Average total compensation was between $50,000 and $99,999 for a third of the worksite reps, while 13% earned between $200,000 and $300,000, Eastbridge found.
The top five voluntary worksite products sold by the surveyed firms are universal life, supplemental medical, disability, critical illness and cancer.
Eastbridge cautions that its findings are based on returns from only 32 companies selling voluntary employer benefits through sales reps who call on brokers.
While the sample is small, it does give an indication of trends in compensation and how companies use sales reps to sell worksite products, says Bonnie Brazzell, vice president of Eastbridge.
The study does not cover broker compensation–only the compensation paid to company sales reps who call on brokers in an effort to get them to sell their insurance companys voluntary products, Brazzell notes.
About a third of the companies in the market sell to brokers through employees who promote only worksite products, she says. About another third employ sales reps to promote both worksite and group products to brokers.
In addition, 29% use other vendors reps to promote either their own or other companies worksite products.
Thirty percent of companies using worksite-only reps said their average rep earns a base salary of more than $75,000.
For firms whose reps sell both voluntary worksite and group benefits, only 8% of their reps exceed the $75,000 level, Eastbridge found.
However, these reps have higher total compensation than worksite-only reps because they earn bonuses on a larger array of products, Brazzell explains.
Most carriers expect their worksite reps to produce between $1 million and $2 million in voluntary product sales. About 25% expect sales in the $500,000 to $1 million range.
Sales goals were often influenced by the individuals tenure and where their territory was located, the study found.
Sales regions varied widely, but Eastbridge found most reps territories covered an entire state or a part of a state, rather than several states.
Respondents averaged a worksite sales force of 34. “However, there was a significant range of numbers within the sample,” says Eastbridge. “The median number of worksite sales reps was six.”
Most of the companies surveyed report annual worksite sales between $10 million and $50 million, Eastbridge found. Among these, a sales range between $10 million and $20 million was the most common.
Most companies base at least part of the bonuses paid on premiums written, although some reps received bonuses for reaching or beating goals for profits, cross-selling, product mix or premiums actually collected, Eastbridge found.
Reproduced from National Underwriter Edition, April 21, 2003. Copyright 2003 by The National Underwriter Company in the serial publication. All rights reserved. Copyright in this article as an independent work may be held by the author.