Reading the comments of Maurice Greenberg to the LIMRA annual meeting as reported in the Oct. 25 issue of National Underwriter caused me to have a “flashback.” In his remarks, Greenberg rejected the notion that the life insurance industry is mature. A mature industry has special meaning to market researchers and my flashback related to a presentation made by an independent marketing researcher at an industry meeting almost 30 years ago.
In that presentation, the researcher, using graphs and illustrations, charted the growth of a typical industry and how, over time, demand for the product levels off and grows only in proportion to population growth, or may even decline. This was deemed a mature industry and we were placed in that category. To say the least, it was a pretty gloomy presentation and I for one did not buy it then, and like Greenberg, dont buy it now.
Regarding that presentation, several things seem worth noting. First, that particular researcher has not been heard from in years. Second, the highest honor club in my company required $35,000 in first-year commissions in the year of the presentation, whereas today the qualification requires more than $200,000. Third, some of the companies that bought into the concept and changed their approach to the market are no longer a factor in our marketplace.
But these were confusing times and complicating the picture further was a prediction by Jim Anderson, managing partner of a prestigious actuarial firm. Anderson predicted that by 1990 there would be only 25,000 agents left in the field and their role would be not so much sales-oriented, but rather consultative on a wide range of financial services. This prediction reverberated throughout the industry in speeches and articles in the media. At the time it reminded me of the Chinese proverb: “One dog barks, and a hundred bark at the noise.”
I have been listening to and reading about predictions regarding our business for almost 50 years and for the most part, they have been wrong. Inasmuch as many of them, if not most, have been gloomy, I suppose we should be thankful that they did not materialize. But it does prompt the questionwhy? I believe there are several plausible explanations.