The National Association of Insurance and Financial Advisors says it will be responding to declining membership by trying to create more customer value.

The board of NAIFA, Falls Church, Va., hired an outside research firm to study the views of NAIFA members, recently lapsed members and potential members.

“What emerged was a picture of an industry that has changed dramatically over the past 20-30 years and of an organization (NAIFA) that has not kept pace with that change,” NAIFA officials write in a summary of the research firm’s findings.

NAIFA was founded in 1890 as the National Association of Life Underwriters.

Although NAIFA still has 800 state and local associations, a formidable lobbying organization and more than 225,000 members, membership has dropped by more than half over the last 14 years, and the average age of the remaining members is over 50, officials write.

“NAIFA is increasingly viewed as an irrelevant and archaic organization for a limited segment of the industry,” officials warn.

Even the move to change the group’s name to NAIFA in 1999 “is seen as form over substance,” officials write.

One step NAIFA will take is to adopt a strategic plan that will adopt a “marketplace-driven approach to local membership,” officials write.

NAIFA members will have to join the national organization and a state chapter, but, starting in September 2008, they will be able to choose whether to join a local association, and which local association to join, officials write.

NAIFA will minimize reliance on the 117-year-old local association distribution system by making more use of wireless and computer technology, officials write.

The group also will try to adopt a “customer focus,” develop products that better meet members’ needs, collaborate more with other industry organizations, and set up task forces to develop plans and programs in the areas of advocacy, education, sales training, and networking, officials write.