Last month, MetLife’s individual distribution organization rebranded as the MetLife Premier Client Group. LifeHealthPro spoke with Paul LaPiana, head of the group, to see how distribution models are evolving and what is on the horizon. The following are excerpts.
LHP: What is MetLife’s evolving approach to doing business?
LaPiana: Improving the professionalism of our organization, focusing our advisors on more of a comprehensive, holistic approach to both the wealth management and risk management needs of our clients.
We’re really understanding the needs, the comprehensive needs, of the clients that we serve and we’re bringing them solutions to meet the needs. We’ll figure out the product needs as we get to the right solutions on behalf of the clients. One of the things we’ve invested in is the Client Engagement Model. This is three things:
- Standardizes the process of planning with clients – kind of like the CFP six steps of the financial planning process.
- Provides a lot of skillset development. We’ve actually partnered with a global training organization to help our advisors get better at developing relationships with clients, asking the right questions, listening to clients so they understand what the clients are truly trying to get done.
- Allows a consistent framework for training. First-line and second-line managers have the ability to coach our advisors and help them get better at their practice, make sure they’re addressing weak spots in their practice so that they can be more efficient and effective as a producer for our organization.
LHP: How are distribution models evolving?
LaPiana: It’s interesting. In the last decade I’ve seen distribution start to converge. And what I mean by that is when I started in the business, we were in the life insurance business. And when you got into this type of a profession, that’s what you did predominately was sold life insurance and risk-based type products – some annuities.
Now what distribution is wanting to do is be able to develop relationships with clients, manage their wealth but also address their risk management needs. You see the wire houses and the brokerage firms, who have assets and have relationships, are looking at how do they get the risk management expertise within their organization and there’s various models to help get them that expertise.
What you see in the career, let’s call it the affiliated distribution tied to insurance companies, is that they’ve got the risk management understanding and expertise and what they’re doing is enhancing their broker dealer as well as wealth management capabilities, so that they can attract the assets under management. What you see clients wanting now, you look at the LIMRA studies or you look at any of the studies that come from some of the newspapers, is the client going to trust an advisor? They want the ability to go to one place, trust the individual has their best interest in mind, and then be able to bring the solutions and products – that they’re not tied to any one proprietary product or carrier, etc. – really come in with an objective, independent type of an approach to help them get to where they want to go. It’s mobilizing expertise and the resources around the client so they can meet their goals and objectives.
LHP: So there’s a move to a much more holisitic kind of service?
LaPiana: Yeah, I would say that most of the distribution channels that we deal with at MetLife which is one, our MetLife Premier Client Group, which is our affiliated channel as well as the third-party distribution business, are all heading towards comprehensive, holistic planning for clients – not a product – which is about understanding clients’ needs, what they’re trying to achieve, and then providing the solutions.
Some of them are product-based solutions, some of them ultimately get to the product, it’s having the right opportunity to sell, sometimes proprietary products, but also having open architecture so you can sell products that are not a part of your firm, but are through the broker-dealer and on your platform so you’re always looking at what’s best for the client versus trying to drive any one kind of product or service from a company.
LHP: How do you think this will continue to be more dominant over the next five years?
LaPiana: I think with where baby boomers are today – we’ve got 78 million baby boomers, 10,000 a day turning 65 – they control $7 trillion in investables, more and more as those people have to make some accumulation decisions, a lot of income decisions, and a lot of legacy decisions, they’re going to start to – I don’t want to say demand – but I want to say they’re going to expect from their advisors that they’re looking at the entire picture versus looking at only one part of the picture.
Now, one of the ways we’re addressing that is we’ve been, for the last three years, working on advisor teaming. What that means is bringing producers together, advisors together formally as a team because it’s very difficult to address and be an expert in all the aspects of financial planning because it’s just too technical. So we have successful advisors in the risk management area partnering with successful advisors in the wealth management area, together they form a team. They’ve got some infrastructure support folks, sometimes junior partners, that gives them a better platform to address the holistic needs of the clients.
Also … because they’ve got infrastructure to support them, and even junior advisors to support them — you see the service levels go up because the top advisors are focused on getting the client’s work done. Let’s call it phased implementation and the team it supports making sure everything gets done, but also handling service on behalf of the client. I think that’s starting to evolve across the industry – definitely evolving.
The other thing is from a regulatory standpoint. No one knows where the fiduciary standards will end up. I think regulatory may drive some of this but I also think that the right firms from a distribution perspective understand this is the best way to go at it. And if you really have good client connections and relationship … you’re going to be able to have multiple products within the household and you’re going to have a much better and more profitable client relationship, and better retention with the clients that you serve.
See also: Put the life back in life insurance