San Antonio, Texas

How to work effectively with broker-dealers is a sometimes mystifying question for insurance-trained professionals seeking to do business in the broker-dealer sector. But several panelists at a conference here suggested the solution comes down to providing superior service, which includes effective communications.

For example, “we listen all the time…, we need to follow up, and we send a personal thank you card,” said John Keller, a wholesaler for Jackson National Life Distributors, based out of San Antonio.

In talking about fixed annuities with advisors at the B-D, “you’ve got to be honest,” Keller said. If the wholesaler makes mistakes with just one advisor, he cautioned, that advisor will tell 4 friends and word will get around.

He spoke during a panel at the annual annuity conference co-sponsored by LIMRA, LOMA and Society of Actuaries.

The point to keep in mind, Keller said, is that advisors at a broker-dealer need accurate information. “They don’t want to be embarrassed when they go to the client.”

“Stress building lasting relationships, as a partner,” said Beau Niedermeier, a regional vice president at Jackson National based in Rockwall, Texas. “Keep calling on them and prospecting them…about building our business together.”

He said he does talk with advisors about product features when discussing how to position variable annuities for retirement planning. He might discuss VA guarantees now being offered, for example.

But Niedermeier avoids “throwing product” at reps. Instead, he focuses on discussing what will help reps grow their business by solving customer needs. He may suggest doing seminars, he said, or having customer appreciation events or taking customers out to dinner. But he also focuses on making it as easy as possible for reps to do their business, he said.

Find out what reps need from the home office and make it happen, suggested Keller. The needs can range from returned phone calls to stand-out sales kits and more.

The bottom line is to “be responsive,” said Niedermeier.

In recent months, brokers have been more open to wholesalers, Niedermeier noted. “They are asking the right questions. It’s not a matter of, “hey, where’d you get the pizza?” he said. Rather, what they’re saying is, “I have a client who might benefit from that product you mentioned last time.”

At a pension conference held here in tandem with the annuity conference and sponsored by the same three associations, another panel also looked into the broker-dealer environment–specifically, into how to work with B-Ds in the 401(k) market.

To be effective in this market, “the 401(k) provider must serve the advisor very well,” said Ronald L. Bush, principal of Brightwork Partners LLC, Stamford, Conn.

A 2004 survey that Brightwork did on what advisors want from 401(k) providers uncovered a long list of criteria that advisors have for selecting 401(k) providers. Significantly, service ranked highest.

For instance, 66% rated as “absolutely essential” and 29% rated as “very important” the criterion of “being highly responsive to plan sponsor service requests,” according to results shown during the panel discussion. Next came “being highly responsive to requests from the advisor,” with 62% and 34% ratings, respectively; followed by “offering highly effective participant service features such as call centers, Internet service site and interactive voice response unit,” at 54% and 35% respectively.

The 401(k) providers should focus on doing “a darn good job of servicing the advisors,” said Karen Betts, assistant vice president, AXA Distributors, New York. “It’s service first. The investment product is important only after service.”

When Betts worked at Chase, during its entry into 401(k)s for small businesses, she said she “wanted to have sound partners. The number one criterion for me was the reputation of my alliance partners. I wanted to be sure they were in the business and committed to service….And I wanted my small business clients to feel like mid-market institutional clients–that we would take care of them.”

Betts viewed the business partnership approach as key to making that happen.

Connie Moore, vice president-regional brokerage at McDonald Investments Inc., Cleveland, Ohio, emphasized service, too. For instance, “we want local support…and commitment, to help us do our job with educating advisors on retirement planning.”

The provider should be responsive to the plan sponsor, too, she said. “We like quick turnaround. And don’t make a mistake with their [the advisors'] client; if you do, they’re moving on.”

Similarly, “smooth-as-possible implementation” is important, Moore said, and a call center is “essential.”

“I don’t need a [coffee] mug or pencil box,” concluded Betts. “I need you to be a business alliance partner. You don’t need quantity; you need quality. Leave the competitive edge at home and be part of a team.”

‘I don’t need a [coffee] mug or pencil box. I need you to be a business alliance partner’