Best of Producer Roundtable, Part II

“Most life products today push too much of the compensation upfront and too little in renewals. Service on existing clients will decrease unless there is future sales potential. I would like to see carriers reduce first-year commissions and increase renewals. 50% to 75% of the renewal should be a servicing fee. The balance would go to the original writing agent. When one gets a new client, the servicing of the old policies is done for free, which is certainly not a good business model. If carriers would allow an agent of record change, the new agent would be paid the servicing fee, and the writing agent who neglected the client’s proper service would no longer be paid for doing nothing.” — Stephen O. Rothschild, CLU, ChFC, CRC, RFC

From the September 2011 LIS Producer Roundtable feature, “The Future of Life”

October 2011: The Impact of Health Care Reform

“ObamaCare’s impact on our agency strategy is significant — and multi-layered. We are committed to serving the employer market — group — because we believe it will continue to exist. One study by McKinsey & Co. suggests 35% of the employer market will cede to the state-based exchanges required to be established by 2014. However, most studies conclude the opposite, with a stronger employer market. We are concentrating our growth efforts in the middle- to large-market segments — 100-plus employees. The exchanges will disrupt the small-group market segment — less than 100 employees — by competing directly with brokers, or at the very least, reducing their compensation. If what’s happened in Massachusetts is any indication, they will create legislative advantages to grow their presence, becoming a referee and a player at the same time — a difficult competitive challenge. — Mark S. Gaunya, GBA

From the October 2011 LIS Producer Roundtable feature, “Selling In The Age Of Health Care Reform: How Top Producers Are Addressing The Challenges”

November 2011: The LTCI Market

“Traditional LTCI has a significant place in the market, and it creates the initial discussion, but we’re very bullish on the hybrids and prefer them in many cases … In my opinion, some hybrids create the most efficient and near-perfect three-legged strategy stool — life insurance for a beneficiary, long-term care benefits for the insured and a refund of premium for the owner should the situation change in the future. Reallocating an existing low-interest or dormant cash asset makes a great deal of sense in many situations because someone will benefit from the hybrids we utilize. With traditional LTCI, you have a 40% to 50% utilization rate, depending upon which statistical source you use, meaning 60% to 50% of insureds will never file a claim.” — Mark S. Jones, LUTCF

From the November 2011 LIS Producer Roundtable feature, “How Things are Shaping Up in the LTCI Market”

December 2011: The Middle-Income Market

“To sum it up, the middle market is crying out for help. They don’t want to buy insurance any more now than ever. But they do want help investing their money and determining the goals and objectives. Most have no clue how much they really need to save and whether they can get there. We are the solution. And the more time and energy we invest in our clients, the more referrals and satisfied clients we will reap from the process. So I would strongly recommend learning how to manage money. Most advisors will never do this themselves. But they can team up with organizations that can do this and be finders and relationship managers. Financial services is a team sport. The stand-alone advisor is becoming extinct. The need for a team approach is fast becoming the way of the future. So now is the time to start building your team and services.” — Guy E. Baker, MSFS, CLU

From the December 2011 LIS Producer Roundtable feature, “Are You Ignoring the Market Most in Need of Your Help?”

Read Best of Producer Roundtable, Part I.