Larry Dahl, President, Ash Brokerage
Jason Lea, President, Brokers’ Service Marketing Group
Ben Nevejans, Chief Marketing Officer, LifePro Financial Services
Q: Most “life shops” actually provide a wide range of products including annuities, long term care insurance and disability income protection. What is the full range of product types your agency offers, and what steps do you take to help/encourage/beg/nag/coerce “life producers” to further protect their client’s financial well-being by planning for long term care and disability risks?
Larry Dahl: We encourage our advisor partners to take an individual, client-centric approach to protection, accumulation and income planning. Certainly, a comprehensive plan for life insurance is the foundation, but you can’t complete the planning process by leaving out coverage for risks that can devastate clients. In addition to life insurance, we also offer annuities, linked benefits, long term care and disability income. This ensures that the risk conversation will focus on the goals and dreams of each individual, family and business.
Our DI and LTC offerings are unique because we encourage producers to take advantage of our offer to do the “heavy lifting” and utilize some of the best talent in the business. It’s not enough to just run a quote—our team will explore all options and then explain why the recommended solution makes sense for their client. We understand that our producers can’t be experts in all products, so we assembled the experts for them.
Jason Lea: Brokers’ Service Marketing Group (BSMG) started in 1972 as a life insurance brokerage agency, and in 2000 we added annuities, long term care insurance and disability insurance. Most BGAs have access to virtually every product worth selling, so products and compensation are barely table stakes. Producers want unique value for their practice added to the equation. Today we’re focused on changing the BGA model by modernizing it for the 21st century producer. Our business is now focused on a narrowed group of carriers with whom we have agreed to partner more closely than ever before. We have combined the latest tools in technology and digital marketing with our team of insurance experts—and it is a powerful combination. Now, we can consistently reach producers in exciting new ways, the ways they prefer, and help them communicate with their clients more effectively about optimizing risk management. We are proactive and accessible every day—we don’t wait for the phone to ring. Our producers want experts who can help them solve problems for clients—a secret weapon. We help them protect families and businesses and create transformational solutions.
The long term care opportunity is a great example of how unique, value-added services can make a difference. Seventy percent of retirees will need some form of care, yet fewer than 10 percent of eligible buyers have any form of a long term care solution. Producers today recognize the financial risk their clients are up against by not having a plan for dealing with long term care risk, but they don’t bring it up with clients because they are not comfortable talking about it. We help our producers understand that it’s their duty as financial professionals to start the conversation, and we give them the tools they need (workshops, study groups and one-on-one conversations) to build their confidence. Here’s the cool part: When they start speaking with their clients about planning for long term care risks, their clients are grateful for the conversation, the relationship is strengthened and sales happen. There are also exciting new long term care solutions available today (at a guaranteed fixed price for a guaranteed fixed benefit) that simply didn’t exist five years ago. Our sales team members are experts at helping top producers position these new long term care solutions to their clients.
Ben Nevejans: As a full service BGA/IMO we view our role as one of complete advisor support. With that, it is imperative that we offer not only core life and annuity products but long term care and critical care options as well. Like us, we encourage our advisors to take a holistic approach when working with clients. The odds that their client will have a long term care need during the relationship is much greater than the odds of a death benefit need during that same time frame. It is even more vital when providing clients with retirement and cash accumulation solutions. In these cases it becomes not only an opportunity but also the responsibility of the advisor to help protect their clients against the possibility of an unplanned illness which could easily derail a lifetime of retirement planning.
Q: With the decline of the career agency system, much of the traditional training and education of agents has either evaporated or shifted. What does your agency offer to further the training and education of both “new” and established agents?
Lea: Training and education are at the absolute core of our business. We pioneered live producer events in the 1980s and continue to innovate today with a dynamic combination of live educational events, original videos, webinars and conference calls. Over the years we have created a spirit of community and thought leadership among our producers—a sense that being part of the BSMG “family” is both worthwhile and rewarding. This year we are embarking on an exciting new digital marketing strategy to create a true virtual community that relies on high quality online content and the use of new mediums such as Google hangouts, targeted LinkedIn conversations, and the launch of our blog and two new websites—www.bsmg.net and www.getvive.com, just to name a few.
Twenty years ago, NAIFA and FSP chapter meetings were bustling, and today they have dwindled dramatically. Producers are going online to “network” on LinkedIn and searching on Google to get their questions answered. We have made a significant investment and have hired exceptional digital marketing talent to make sure that our content shows up in the right place for the right professionals. We consistently publish content, such as our Retirement Planning Playbook and Policy Review Checklist, hold educational webinars, host large scale training/CE events with nationally recognized speakers, as well as hosting networking events where our producers can share their success stories and best practices with one another. We also use on-demand video as a flexible practice enhancement tool to meet our agents’ changing needs, effectively creating a digital, 24/7 version of our sales team’s client positioning capabilities and concepts.
In the near future, producers will rely on a much more social, online approach to finding the content they need to grow their practices. This landscape is changing rapidly. Just think about how much more you use LinkedIn today compared to two years ago, then compare that to four years ago—the difference for all of us is astounding. Where will it be two years from now? What tools will producers use? Combining all of this technology and training, our consultative sales team is one key to keep us moving forward. Our company is there every day to support and help producers to enhance their practices, and we will constantly stay ahead of the latest trends to capitalize on new opportunities.
Nevejans: Whether a brand new advisor or a seasoned veteran, education must be a major focus in a successful practice. We constantly check the pulse of our Top of the Table and Elite advisors, and the most apparent common denominator is the importance placed and the money spent on continued education. With this in mind, LifePro conducts a 30- to 45-minute educational training webinar every day. Topics range from case design, sales concepts and solutions, best practices and advanced market specialties. No advisor can or should spend all of his time on webinars, but it is important to make education a habit, and the less time spent looking for education and the more time spent engaging in it the better. Additionally we conduct live educational teachings in our 2500 square foot training center, often flying advisors in from all over the country. We focus on topics such as tax-free retirement, Social Security maximization, IUL, annuity concepts, premium financing, and many more advance market topics. Knowledge is great, but action is the key. Not only do we provide the knowledge, but each training exercise is packaged with a turn-key process for the advisor to effectively deliver the message to new prospects and clients alike, ensuring that their education leads to solutions and commissions.
Dahl: Keeping pace with an industry landscape that is constantly changing is a challenge; our solution is to offer continuous learning opportunities for advisors at every stage in their careers. To encourage young insurance professionals, we have created a young advisors group for those with 20 years or more left in their careers. Here they receive training, support, mentorship and potential recruitment opportunities. Twice a year, top advisors and industry leaders are invited to our summit meetings, which allow them to share best practices and gain insight on trends and opportunities.
For all advisors, we have multiple educational events and meetings throughout the year, as well as an extensive online library of videos, webinars, blogs and industry news articles to help them stay up-to-date with the latest practices. Most important, we provide technical support around sales, with advanced marketing, attorneys, underwriting, etc., for individual client situations. Often, the best training is “on the job.” Nothing is more satisfying than hearing your client say, “Thank you—you provided exactly what we needed to meet our needs and fulfill our dreams.”
Q: Between the aging of the agent force and the distinct possibility of consumer lack of awareness, under-performing or soon-to-lapse policies can have major consequences for consumers and their financial planning goals. How important, structured and persistent are your agency’s policy review initiatives?
Nevejans: One of the most underserved areas in financial services could quite possibly be in-force life insurance. Unfortunately many clients purchased life insurance with the “set it and forget it” mentality. As we all know, even if the client purchased a GUL or whole life policy, rare is the case in which the product does not need to be reviewed and adjusted to reach the current goals of the client. Not only does this unfortunate phenomenon present a problem for the client who may be paying inadequate premiums into a “ticking time bomb,” but it is also a huge problem for our industry. With that said, why are so few advisors willing to conduct policy reviews? From my experience there are three main reasons: Fear, knowledge and lack of incentive. Many are afraid to go back to existing clients and point out that the product they sold is now inferior and may not be meeting the goals of the client. To this I tell my advisors that it was not a crime to offer the best product for the time with the knowledge that they had then. Like in the car industry, insurance policies are improving and becoming more efficient every year. My dad drove a sweet Cadillac in my youth, but even if it was in pristine condition today I’d still opt for my all-wheel drive, attention assist and satellite radio, and I expect my car dealer to update me on new options and features as they come out.
Unfortunately, getting information from the carriers can be time-consuming at best. At worst it is impossible. This is the next barrier many advisors face. Because of this we have developed a turn-key program to take the pain out of that process and allow us to utilize our expertise in working with carriers to get the information quickly and efficiently and to package it in an easy-to-present report.
Lastly, there is no perceived monetary reward for reviewing existing policies. To really recognize the value of conducting policy audits one must look past the small, often non-existent renewal commissions. The true value lies in the additional discovery process where new opportunities are uncovered. The trust factor can’t be overlooked either. There is an incredible amount of value, including referrals, from providing this type of service to an existing client.
Not only does LifePro provide the ability to access the necessary information about the in-force policy, but we also compare it to the best-in-class products available now and package them in a full report called ReProject. Our advisor then has the ability in most cases to: a) systematically show the client that what they had is working exactly like they thought it was, b) show them how they can have a more effective product for the same amount of outlay, or c) provide them with the same benefits for less out-of-pocket expense.
Dahl: We are proud of the positive impact we have made on many lives through our close, consultative relationships with our advisors. We firmly believe policies should be reviewed on an annual basis, or at minimum every two to three years, and we arguably have dedicated more resources to policy review than any other agency.
Our life insurance portfolio analysis gives an in-depth and objective review of existing policies. With proper permission, we request all data from the life insurance companies and put it all into a professional output that flows logically and is easily understood. The resulting information can not only help ensure that clients are maximizing their insurance dollars but also confirm the policies are performing as originally intended, which could save the client money, give the beneficiaries a larger death benefit, or ensure that their legacy plan can be executed with ease.
Lea: Our mission states that “Every day we will: Provide an extraordinary experience, deliver solutions that exceed expectations, create success, and do the good and right thing…for everyone” and is at the core of everything we do. Policy review is essential to ensuring that clients are still in the best position possible and their existing policy is best suited for their needs. In some cases a policy review may result in simple contract changes such as beneficiary or owner changes, not necessarily a new revenue opportunity; however, these can be equally as important as initiating a new policy.
Policy review is a critical part of our business model. Historically, many of our larger, permanent life insurance sales have come out of a policy review scenario. We have a proprietary policy review process which we employ not only at the time of sale but which persists every year after a new policy is issued. We are also piloting a new technology that will allow us to monitor all inforce policies for our agents (any life policy written over the last 40 years), and help them to recognize those policies that are ready for review or have other actionable triggering events. From now on, unified in-force policy management must be a key value driver for producers.
Every permanent life insurance policy should be understood as a fully-evolved asset class and as such should be monitored in the same manner as other assets of significance. Our clients in this space are most often insurance producers, but we also work with broker/dealers, bank trust officers, estate planning attorneys and CPAs. We help them to frame a policy review process. Not having a formal policy review process may open exposure to the liability of not adhering to the fiduciary responsibility that comes along with being a trustee of a life insurance policy. We aim to provide education on the importance of the review process, as well as the risks of not performing policy review.
In addition, our risk differentiation underwriting (RDU) process enhances many significant policy review cases, enabling us to put many clients in a much better position. Carrier consolidation, product changes, and significant advancements in medicine have led us back to an environment in which our RDU approach truly can differentiate on underwriting. Impairments that were assessed 10 years ago have the opportunity now to be assessed more aggressively, specifically when employing tactics like RDU. With RDU we are not looking at the statistical data to drive pricing, but differentiating on the nuances between clinical medicine and insurance medicine.
Q: Lower and middle income consumers, particularly those “just starting out,” have the need for life insurance protection but often can only budget for term insurance. What does your agency do to a) encourage producers to reach out to fulfill these needs; and b) simplify the process to keep it as profitable as possible for both your agency and the producers you serve?
Dahl: Often, advisors and agents say term insurance is not profitable. We prefer to view it from the client’s perspective. We want to impact as many lives as possible. When advisors take this approach, they will make a huge difference, and the result will be a by-product of “doing what is right.”
As an agency, we encourage agents to follow these clients through their life stages. As these clients have life events (marriage, the birth of a child, purchasing a first home, etc.), term insurance is critical in order to protect what they love most. As these same clients start to get into the high earning years of their careers, they have already established relationships with trusted advisors who can help guide them to other life-appropriate opportunities. We also encourage advisors to work with multiple generations of a family, which can add additional opportunities.
Additionally, we have implemented an electronic application platform to promote solutions with a quick underwriting process, such as Principal’s accelerated underwriting platform. This platform makes the experience easier for the advisors and their clients.
Lea: At BSMG our vision is to “Protect the future of families and businesses. Our innovation and passion will empower financial advisors and institutions to achieve transformational results for their clients.” This means families of all income levels.
Ten years ago we created a proprietary process and web-based platform specifically for the producer serving lower and middle income consumers. We have used cutting-edge technology combined with highly experienced insurance professionals and melded the two together seamlessly to create what is now called Vive. Vive enables the financial professional to transact term life insurance online in 10 minutes with no paperwork and no client signatures. It’s incredibly easy and intuitive to use. Once the producer submits an order on Vive, our dedicated internal team handles the new business, underwriting and policy issue processes. All along, the producer is kept up-to-date while we provide an incredible service experience to the client. Vive is the industry’s best and only award-winning, multi-carrier, drop ticket term engine available today.
We’re always proactively seeking out distribution relationships that have access to and focus on the middle market. Vive aligns perfectly with what they are already doing and becomes a turnkey revenue accelerator. By educating all types of producers (B/D reps, bank reps, independent brokers and advisors) we’ve found that term insurance in 10 minutes is profitable—it’s an eye opener and game changer for them. They begin to focus on this segment of the market. Vive provides them the platform to reach the market that they know needs to be addressed to do the good and right thing for consumers, while creating a new profit center for their businesses.
In the not too distant future we are planning to deliver an experience in which producers can use Vive, offer all of the most competitive solutions to their clients as they can today, and get a policy approval immediately.
Nevejans: There are many different kinds of clients in all different phases of life. Just because a prospect is starting a new family and/or a new career it doesn’t necessarily mean he is not a qualified prospect, and what’s more, that he doesn’t have a great need for life insurance. Quite the contrary, he probably has the largest need—and not unlike a good professional athletic team, your practice needs a strong bench. Although we would all love to attract and recruit only “A” clients, it’s important to have organic growth within a practice to point to and to be looking for the next generation of “As” that are loyal and trusting.
Q: Impaired risk business is generally considered the foundation on which today’s life brokerage business was built. How much of your business is still “sub-standard,” and how does your agency help brokers in the placement of impaired risk cases?
Lea: We do not look at a risk as sub-standard; we look at it as a special risk. We do not look at the special risk marketplace as the conventional industry has, but rather we look at it as one of the harbingers differentiating the BGA marketplace today. At BSMG we employ a unique underwriting strategy on those engagements that demand more time and piercing intellectual inquiry. It’s called risk differentiation underwriting—RDU.
We have seen growth in the number of cases that we process using this RDU strategy. We have been able to place cases for clients that experienced multiple declines when processed using a more traditional underwriting approach.
RDU is not bound by the conventional wisdom of how pricing is determined at the carrier but looks at how clinical care is done at the client level to find differentiation. The focus of RDU is not to change the way home office underwriters and medical directors assess risk. The aim is to recognize when a particular case exhibits qualities which are inherently different from a more standardized version of the same risk.
We recognize that delivering favorable underwriting results when assisting affluent clients with impactful clinical conditions can be a significant challenge, a challenge that BSMG can uniquely help top producers and their clients overcome.
RDU gets results that others simply cannot because we dig deeper, giving the underwriter a more complete, individualized picture of the client’s health history and insurability. We work directly with the producer, the client and the client’s corps of physicians to separate their individual risk from an otherwise statistical/actuarial grouping. RDU allows the producer to bring this differentiator to his or her client at the point of sale, rather than at the point of underwriting result disappointment. The result: a fully educated client, a more amplified and complete risk for the insurance carrier (that would otherwise not be placed) and a deepened client relationship. [JL]
Nevejans: For many advisors the underwriting process can be an unpleasant experience. What most don’t understand is that there are two sales cycles to every life insurance sale: 1) selling to the client, and 2) selling to the underwriter. Having to go back to your client for additional premium or a lower projected accumulated amount is scary and can be a deal-killer if mishandled. With this in mind, LifePro has created a complete system that will turn this perceived industry pitfall into a relationship strengthening tool. We give our advisors the ability to help those who need their help most and increase their commissions at the same time. RATE, LifePro’s risk assessment, turn-key evaluation, allows our advisors to provide a full report including several reputable carriers’ underwriting decisions, negotiated rate classes and premiums, client-friendly illustrations, and an executive report, giving them the ability to show their clients the levels of professionalism and due diligence they have performed on their behalf. Think how many cases over the years have been rated or declined, creating the loss of thousands of dollars in commission, but more important, the loss of benefits that families did not receive. With RATE, LifePro has been able to turn these missed opportunities into real value for the consumer, the agent and the carrier. [BN]
Dahl: In 2015, less than 20 percent of all placed business fell into the substandard category. With that said, on the formal substandard business we advocated for, we were able to maintain a similar placement ratio when compared to other non-impaired risk business. This is significant, as our placement ratios historically range approximately 10 points higher than the industry average.
We attribute our success in the substandard market to our integrative approach of underwriting, case management and marketing. We train our case management staff to not only be process advocates but also risk advocates, and to be able to navigate other-than-applied scenarios and pivot cases with ease. Our case managers and underwriters also partner with marketing support to ensure that when we have exhausted all options as they relate to rate class, we also exhaust all product solutions that could improve the outcome for the client. [LD]
