Low angle view of an airplane in flight (Photo: Purestock/Thinkstock) (Photo: Purestock/Thinkstock)

Life insurance moves through a sales channel. It travels from the insurance company through brokerage agencies, who rely on independent and corporate agents to sell the policy, to the end consumer. When designing a strategic incentive program, the objective is to identify at what point in the sales channel incentive rewards can be applied to generate the greatest ROI.

In life insurance sales, incentives for the end consumer are limited to rebates and wellness-related metrics. Legally and ethically, you cannot use incentives to influence their decision.

(Related: A Six-Figure Income May Not Shield Consumers From a Shock)

So, looking at this model, ask yourself, “Who, ultimately, has the most influence on whether or not the end consumer purchases a life insurance policy?”

If you guessed the individual agents, you guessed correctly.

Incentive travel programs are a proven way to motivate insurance agents, to create more emotionally impactful experiences for them than cash commission alone, and to encourage longer-lasting changes in behavior.

Here’s a look at five ways to use incentive travel to encourage agents protect more people against mortality and longevity risk.

1. Design your incentive travel program in a way that doesn’t create a conflict of interest for your agents.

This is a no-brainer, but it’s one of the most important decisions life insurance distribution organization will make when designing their insurance program. The U.S. Department of Labor’s proposed fiduciary rule, which would have greatly restricted the use of travel incentives for life insurance agents, was shot down by a federal appeals court last year. But potential changes in market sentiment have caused many life insurance distribution organizations to move away from sales-based metrics, which might pressure agents to sell policies based on the biggest impact to the bottom line instead of the best interests of their clients.

Many of our clients have moved to a more holistic approach. Incentive points can be issued on a variety of metrics, all of which are beneficial to the company’s bottom line in the long run.

Product knowledge is crucial as life insurance agents move into a more advisory role. Rewarding points based on product knowledge will ultimately make them better agents and more effective salespeople. Other clients assign points upholding company values, providing better area coverage, or for being loyal to the company (based on tenure). All of these are beneficial to companies who look at the bigger picture.

2. Use tiered travel rewards to recognize top performers and to create a sense of in-house competition.

Generally, an effective way to reward top agents and to get more from your middling majority is to have different travel destinations based on the metric you choose. So, for instance, you might offer five nights in Tahiti for the top 20% and five nights in Cancun for the middle 60% of your agents.

This tiered system recognizes your top agents for going above and beyond, offers attainable goals for those who know they won’t be able to qualify for the top tier reward and pushes the agents who might be on the cusp to try that much harder.

This type of strategy boosts production throughout your whole life insurance sales network.

3. Use incentive travel as an opportunity to solidify key business relationships and retain top sales talent.

A performance-based incentive travel trip is a great opportunity to solidify your relationship with top agents on a more personal level. Equally important, it’s a chance to educate them on your products and on the values of your organization. Both of these are important to the long-term success of your company.

4. Use incentive travel to attract next generation talent.

“The future of distribution: insurers grapple with a rapidly changing landscape,” an article by the Insurance Governance Leadership Network, brings up some interesting points about the future of life insurance sales. Digitalization is inevitable. Demographics are changing. It won’t be long before digital natives make up the bulk of the eligible market for life insurance.

Insurance distribution organizations must adapt to changing distribution, communication and marketing preferences to accommodate this new market. Inevitably, many of these solutions will come from millennial work talent. And it’s no secret that millennials value experience. Travel incentives will be a major draw and might just prove to be the differentiator between companies that adapt and thrive in a new paradigm, and those that go the way of the dinosaur.

5. Use incentive travel experiences to improve team chemistry and workplace chemistry.

So far, we’ve primarily focused on how incentive travel can be beneficial to all life insurance distribution companies, but this one is more applicable to those who rely on an internal team of agents.

Let’s face it – life insurance sales can be stressful. Agents have to deal with compliance, reading the fine print, meeting their performance metrics, among other challenges. That kind of pressure can take its toll and lead to dreary days at the office. What’s that saying about all work and no play?

Incentive travel is a great opportunity for corporate agents to build the interpersonal relationships that will help them get through the tough times as a team. Having employees who build each other up and have each other’s backs can make a huge difference for an organization. Incentive travel can be a strong tool to foster that kind of work environment.

As you can see, while things have changed in the world of life incentives, there is still a place for incentive travel. With a little bit of foresight, creativity, and direction, incentive travel is as important and effective for life insurance distributions organizations as it has ever been.

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Mark Herbert (Photo: Incentive Solutions)Mark Herbert is president and chief executive officer of Incentive Solution, a company that manages about 220 incentive programs.