“Remember this: If a farm boy like me can make it to the Top of the Table, be elected president of the Million Dollar Round Table and speak to you from this platform, then what is stopping you from reaching new heights? Just imagine!”
On that rousing note, Lyle Blessman, MDRT’s president in 1994 and president of The Blessman Group, Denver, Colo., helped kick-start MDRT’s 80th annual meeting, held at the Colorado Convention Center June 10-13. The location of the event–Denver sits a mile above sea level–also served as dramatic backdrop for theme of this year’s gathering, “Reach New Heights.”
While encouraging the nearly 7,300 attendees to soar in their own careers by leveraging the 4 days of main platform sessions, educational workshops and networking opportunities, MDRT used the annual meeting to unveil initiatives aimed at bolstering its status as “the premier association of financial professionals.”
Once again, MDRT boosted its membership requirements, demanding of applicants $75,700 in eligible paid commissions or $151,400 in premiums paid or new money invested.
While upping the benchmarks, MDRT is also leveling the playing field for its world-wide membership, which now comprises 35,000-plus life insurance professionals across 76 nations and 476 companies. To that end, the organization will adopt beginning with the 2008 membership year the World Bank’s purchasing power parity index, which equalizes the purchasing power of different currencies in their home countries for a given basket of goods–in this case, membership requirements.
MDRT President Philip Harriman acknowledged the change will engender “winners” and “losers.” While agents in certain nations, such as the Philippines, will enjoy declines in requirements, others face steep increases. Among them: Mexico (up approximately 26%), Chile (31%), and Jamaica (64%). Harriman emphasized, however, that the transition to the new regime will be gradual for those subject to substantially higher benchmarks.
“Where we’ve had dramatic shifts, rather than impose new requirements all in one year, we’re phasing them in over the next 4 years. Once fully implemented, we’ll have a single worldwide standard.”
Also being streamlined is the Round Table’s governance model. Previously, said Harriman, MDRT’s executive committee had to approve all initiatives spearheaded by the organization’s various divisions and other committees. Now, excepting major decisions impacting policy, finances or strategic directions, the various units are free to implement plans on their own.
Among them: MDRTV. To provide live broadcasts and snippets of past conferences, the Internet portal is being rolled out in beta version in Denver. To go live in 2008 (following the debut of MDRT’s revamped website on Sept. 1), MDRTV will complement a new online video club, where members can view main platform and break-out sessions in their entirety from nearly 40 years of annual meetings. The archived content, said Harriman, will be offered to members on a pay-per-view basis and/or subscription basis.
Because MDRTV will be accessible through laptops, iPods and other portable devices, the site is expected to be a key marketing tool in MDRT’s efforts to attract young advisors. Given MDRT’s aging membership-the average advisor is nearing 50-the recruitment drive is a top priority for the organization’s leadership.
“Young people are less interested than older advisors in traveling to a conference for 5 days, however attractive,” said MDRT First Vice President and Incoming President Jim Rogers. “[The aging issue] doesn’t bode well for the future unless we regenerate the organization by bringing on more generation X and Y advisors.”
To be sure, MDRT continues to enjoy high recruitment levels, particularly in Asia, where the organization is growing fastest. Indeed, Pacific Rim nations are in the top 10 by membership and collectively account for more of the organization’s advisors than the U.S., which in 2006 had 14,535 or 41% of the total. Moving up in the ranks are India, which in 2006 held the 6th position at 1,145 members; and China, which occupied the 10th slot with 454 members.
Rogers observes, however, that the Asian contingent is a “soft underbelly”: Only 25% of the region’s members renew after the first year. Yet the life insurance profession is growing so quickly on the continent that new recruits, particularly in China and India, are expected to more than compensate for the turnover in the near-term. Bolstering the promising outlook, Harriman notes, is the fact that more Asian agents are transitioning from part-time work to full-time careers, and thus are more likely to view continuing education as key to achieving succession in the profession.
The greater international challenge for MDRT, said Harriman, lies in boosting its ranks in other English-speaking countries, where beefed up regulatory requirements in response to past financial scandals-most notably in the U.K. and Australia-have “scared” advisors from the profession; and in Central Europe, where the organization has but a tentative foothold. But Harriman said he expects MDRT’s membership numbers in these regions in Europe to rebound. In Europe, the organization is developing materials in local languages (the Continent largely remains averse to doing business in English, said Harriman). The regulatory crackdowns in the U.K. and Australia are, paradoxically, prompting advisors to rethink their view of insurance.
“What I’ve discovered first-hand, particularly in Australia, is that [advisors] are increasingly saying they face liability exposure by not talking to people about transferring risk through life insurance, DI, and so on,” said Harriman. “Now regulators are likely to fine them for not properly insuring clients. And advisors are saying they need assistance in communicating the importance about our products.”
MDRT’s increasing international orientation has prompted the organization to explore holding a second annual meeting beyond its home base. Just 7 locations in the U.S. can accommodate the thousands of attendees who regularly attend the conference, said Rogers. He added that a U.S.-based event, and the need to appeal to MDRT’s core U.S. membership, restricts the organization’s ability to tailor content, such as new tax laws, to non-U.S audiences. Hence the appeal of a second international gathering.
“One approach is to have an English-only summer event in the U.S. to which international members would be invited to come,” said Rogers. “Coupled with this, we might have in the spring or fall a meeting in Asia where we’d offer simultaneous interpretation in 5 or 6 languages. The main platform sessions would be similar to those in the U.S., whereas the afternoon sessions would be targeted to the region. A third annual meeting Europe could be structured similarly.”
“In this way,” he added, “we could speak to the specific needs of members and arguably provide the entire membership with meetings that would be more helpful practices. This particular initiative is one [the executive committee] will continue to discuss.”
Before stepping off-shore, however, MDRT may have to upgrade–or jettison–the language translation software purchased as part of a $2.5 million technology upgrade to MDRT’s website, and which National Underwriter covered in its convention report at this time last year. Promising to deliver web content in (initially) 5 languages, the software has been a source of “frustration,” said Harriman, because of the technology’s continuing inability to capture subtle differences in the meaning of words or phrases.
MDRT’s assessment of its relationships with sister organizations is more upbeat. Harriman said the Round Table is collaborating with several partners, including the American College, the National Association of Insurance and Financial Advisors and the Society of Financial Service Professionals to encourage the professional development of its members and to present a united front against federal and state legislative attacks on the tax-favored treatment of life insurance. This year, MDRT also teamed with GAMA International to avail MDRT members of GAMA’s research into best practices respecting advisor recruitment and practice management.
“If we’re successful with these 2 initiatives, we’ll embark with GAMA on a third project focusing on succession planning to help members transition their businesses at the highest and best value to the next owner,” said Harriman. “MDRT and GAMA have just appointed a committee to execute the first 2 objectives.”
MDRT has also kick-started a task force that will explore ways to encourage members’ professional development. Large percentages of the organization’s ranks still lack such advanced credentials as CLU, ChFC and CFP.
“The modern world of insurance and financial advice-giving is so much more complex than in years past,” said Rogers. “As an organization, we need to actively encourage members to get designations to give more meaning to the MDRT brand. Also, consumer and government pressure may eventually be brought on us to get advanced training.”