Independent financial professionals can broadly be divided between those who do most of their business selling (1) insurance products and (2) investments. What differences in practice focus are there between these two groups?
The LIMRA-NUL IFP study identifies several, starting an obvious one: the percentage of sales or revenue derived from insurance or investments. Among IFPs with an insurance focus, life insurance contributes on average 50 percent of revenue and annuities an additional 11 percent.
Health insurance and P&C products nab an additional 27 percent and 6 percent of revenue, respectively. Investment and advisory services are in the low single digits: just 3 percent and 1 percent, respectively, of sales.
For advisors with an investment focus, share of revenue for the latter two categories are nearly half of the total: 25 percent derived from investments and 22 percent from advisory services. Share of revenue for other solutions break down as follows:
Annuities: 28 percent
Life insurance: 13 percent
Health insurance: 3 percent
Other: 8 percent
Other differences distinguish the two advisor communities. Those with an insurance focus cater, on balance, to a less wealthy clientele.