At the end of last year, LifeHealthPro and Retirement Advisor asked independent producers about their successes and failures, about the policies that defined their practices, about the products their clients found exciting and relevant. One thing became clear: The opportunities are vast, but the challenges are mounting. Being successful as an independent agent in 2014 means being adaptable and intuitive. It requires creativity, digital savvy and a constantly evolving knowledge of the regulatory environment.
Your peers are ready. Are you?
1. Health care reform (28%)
It’s been top of mind for four years, but with the exchanges finally open , health care reform is the No. 1 challenge advisors say they are facing right now. Part of this can be attributed to the haphazard way in which the exchanges were launched, with massive differences in plan offerings and price from state to state, technical access to enrollment options shaky, and many questions still unanswered. Carriers have also lowered commissions in response to the MLR legislation, which means long hours may yield low pay.
And then there is the larger concern that the plans offered under PPACA simply do not meet consumer needs — and are unsustainable for insurers to boot. In response to a recent PwC survey, which trumpeted that premiums were lower on the exchanges than in employer-based plans, Lloyd Lofton shared his concerns: “Marketing a higher deductible health plan so that premiums appear lower for features the consumer doesn’t want, while masking the increased out of pocket exposure for the consumer with tax subsidies (which the consumer ultimately pays for through higher taxes), does not mean the premiums on the exchange are less. In a free market, a business designs a product based on market research and what the competition is doing; they price the product to be competitive and let the market decide [if the product is worthy]. Here, the product is mandated, so the manufacturer (the insurance carrier) prices based on mandated benefits, not on what consumers want.
This can be proven by two facts: First, the law provides subsidies for the consumer based on income, meaning the government knew these mandated benefits the consumer would not want would also be unaffordable without the subsidies; second, the law allows a bailout for insurance companies for several years due to expected loss ratio, because the government knows mandated benefits and government control of the marketplace will not be profitable for the insurance companies. What is not understood is the reason people buy health insurance. It is not for their best health year. It is for their worst health year, and that’s why the private market worked, because that’s what people planned for.”
2. Lead generation (26%)
Leads alone are not enough to carry a business. But an effective lead generation strategy is enough; in fact, it’s a gold mine. The digital age has ushered in a host of new tools that can make collecting and following up on leads simple and effective: social media, digital databases, paperless applications. Alongside standout client service, these tools can make it easier to get and keep appointments with prospects that match your ideal client profile.
Bruce Carlton, CLU, VP of marketing for iGROUP, shares why social media has worked for him — and why tone is everything: “Consumers want to be educated to make an informed decision … not sold. First, embrace social media. This is where everyone is hanging out. Your profile should be relevant and should address problems you can solve versus promoting your company or products. Second, post frequently using excerpts from third party material. The third party piece adds credibility. Taking this approach positions you more favorably than a policy peddler.”