Insurance vs. investment IFPs: Some differences highlighted

Nearly half of their clients (48 percent) have less than $100,000 in investable assets and 23 percent have between $100K and $249K. Fewer than 3 in 10 clients (29 percent) have investable assets exceeding $249,000.

More than half of clients (54 percent) of advisors with an investment focus, in contrast, have investable assets topping $249,000.  And nearly one-third of the clientele (30 percent) hold investable assets topping $500K.

The differences between the two IFPs types extend as well to the state of their practices.

Nearly 4 in 10 (37 percent) of investment-oriented advisors have established practices, a stable client base and are looking for opportunities to expand their businesses. Just 24 percent of insurance-focused advisors fit this description.

Insurance –focused advisors are more in evidence than their investment-oriented counterparts in two other practice categories: (1) those IFPs who are still establishing themselves (31 percent vs. 24 percent); and (2) those who are established but have experienced some years of negative growth (15 percent vs. 9 percent).

Where the two advisor communities are about evenly divided is in the second of two growth phases: IFPs who have a stable client base and revenue stream.

The study flags one other measurable difference between the two IFP types: sourcing preferences. Not surprisingly, among those with an insurance focus, more than half (52 percent) prefer to place fixed life insurance and/or fixed annuity business directly with an insurer. Among those with an investment focus, just 42 percent indicate this preference.

Conversely, 54 percent of investment-oriented IFPs favor working through an intermediary, like a BGA or IMO. This compares to 42 percent of insurance-focused advisors.