Some of the most valuable insights often come from unusual and unexpected encounters. In her chairman’s remarks at NAILBA’s 2011 annual meeting, Christi M. Daughenbaugh told of talking to her hairdresser, a 24-year-old mother-to-be, about life insurance.
The young woman made it clear that she had no interest in buying something that came with a death requirement. That changed, however, when Christi focused on the need to protect her lifestyle. That’s when this young woman asked, almost jokingly, “Will you be my financial coach?”
In a few words, that remark captures what we all need, whether we’re consumers committed to building our financial security or advisors growing a business. We need someone in our corner — someone we trust — to help us maximize our talents, skills and resources.
And just as many producers are moving away from a transaction-based model to becoming financial coaches for their clients, so the brokerage general agency (BGA) is moving away from serving as simply a wholesaler of product. BGAs today are training and coaching producers — serving as a resource to help them succeed.
Since NAILBA held its first annual meeting 30 years ago, BGAs have not only increased in number, but many have also moved from essentially having a local orientation to serving producers regionally and nationally. This is good news for advisors because, today, they have more choices in BGAs than ever before.
So, what should advisors expect from a BGA? While every BGA has its own answers to this question, here are guidelines that may be helpful. When evaluating a BGA, ask yourself if the BGA does the following five things:
1. Ask the right questions?
You may want to be cautious if someone on the sales side of a brokerage firm starts off by telling you what a great deal you’ll get by working with their organization. While compensation is critical, there should be far more to a BGA relationship.
This begins with the BGA rep gaining an understanding of your market. “Tell me about your clients and the types of work you do for them.” Representatives should also express genuine interest in your business by asking about how you conduct your practice, as well as your objectives, your special interests –– and what you expect from a BGA.
Advisors should expect a BGA to invest time, interest and knowledge in an advisor’s work. You’ve learned that information helps build relationships. This is what you do with your clients, and it should be no different in working with a brokerage firm.
2. Keep in touch?
“Do you have any cases we can quote on?” It’s unfortunate that this is the question too many advisors hear from a BGA representative, who then signs off by saying, “Be sure to call us when you have a hot one.”
Such an approach is still far too common and helps explain why some independent advisors view BGAs as doing little more than placing cases, a far less helpful reputation.
Advisors should expect a BGA’s salesperson to stay in touch regularly, bringing helpful ideas and sales strategies. The BGA rep should possess the experience to offer reliable, workable solutions and follow up quickly with additional information. Every advisor needs a reliable sounding board, someone whose goal is listening, not just fishing for a case to quote.
3. Serve as a resource for your practice?
When advisors hand off a quote request or a case for a BGA to work on, they should be confident it will receive a level of attention that results in thoughtful, creative options for consideration by their clients. Solutions should meet a client’s expectations and objectives and, at the same time, give the advisor a competitive edge.
This is where the combined knowledge and experience of a BGA’s internal sales staff can play a key role. They should know the carriers that are a good fit for a particular case. Their knowledge base needs to be both extensive and current, so they can reach out broadly, if necessary, to leave no stone unturned.
Producers who view a BGA as nothing more than a policy transaction mechanism shortchange themselves. Well-staffed BGAs are a unique knowledge resource, combining street smarts with technical insurance expertise.
4. Lead technologically?
While it’s true that the life industry was often slow to adopt technology, they were not alone. BGAs were also behind the curve; many still are. Since many worked with older advisors who were often uncomfortable with technology, the pace was even slower. That’s history. The tipping point came when a combination of cost savings and timely customer service became the drivers. To be competitive, a paperless process has become a business necessity.
Clients expect responsiveness; they don’t expect to wait for information. They want it now, and they will go where they can get it. Today’s BGA should be giving advisors an extra edge by responding quickly. There’s no reason why a BGA today can’t deliver clear, thoughtful and impressive presentations with a high customer appeal and in a timely way.
A critical component of technology leadership is producer training. Without it, even the best tools are useless. In today’s highly competitive environment, it takes technological know-how to work efficiently, manage a practice effectively and provide clients with information instantly. Advisors should expect a BGA to recognize these producer challenges and offer necessary training.
5. Offer a value-based relationship?
For some producers, a transaction-based relationship with one or more BGAs is to their liking. From their perspective, they may see it as the way to obtain the best deal. Even so, they may also be doing themselves –– and their clients –– a disservice.
If we believe that life insurance is a relationship business, one in which an advisor can best serve clients by understanding their needs and objectives, the concept also has validity in the advisor-BGA relationship.
Developing a close working relationship with a BGA is in an advisor’s best interest. The better an advisor and BGA know each other and how to work together, the more productive they can become. With an ever increasing number of products designed to fit narrow niches and meet particular needs, a clear understanding of the client’s situation and an astute evaluation of the products are key to obtaining the best, most cost-effective solution.
It takes time for an advisor to understand and make use of a BGA’s resources and capabilities. In the same way, a BGA needs an opportunity to develop a feel for how each advisor operates. A BGA and an advisor, working together in a value-based relationship, is often the difference between a base hit and a home run.
We’re keenly aware that the life insurance business environment is changing, becoming more challenging and more demanding. New products appear with greater frequency and are often complex and confusing, while older ones change or disappear. There are also far-reaching taxation issues and monumental government regulations. If all this isn’t enough, consumers are so baffled, doubtful and uncertain, they are often unable to make buying decisions.
Independent agents can certainly benefit from working with a resource –– such as a BGA –– that can bring reliable information, real-world experience, new ideas, successful strategies and solid support to their practice.
It’s then that producers should want to ask, “How can you help me grow my business?”