Strengthening distributor networks. There are two main areas of significant importance to Lincoln Benefit Life (LBL) in 2012.
First, we want to deepen our relationships with those brokerage general agencies (BGAs) who are truly focused on offering consumer value-based products, provide incredibly professional service, are transparent in how they operate, are committed to unequivocally excellent customer service, and operate with unquestioned integrity and character. We want to focus on growing our market share within these organizations in a way that provides value to the BGA and to LBL. We’ll continue to focus on operational efficiencies, providing product that has consumer value written all over it and an underwriting experience that is professional, powerful and productive to both parties.
Our second main focus for 2012 is to work with organizations that are committed to penetrating alternate distribution models—banks, broker/dealers and other financial service distribution platforms. We believe that those BGAs who are investing in a wholesaling force and point-of-sale support structure will have the “secret sauce” which will allow them to drive significant premium in these alternative markets. We have expertise through our relationships and our experience in these markets and believe this will offer great opportunities to work together to achieve mutually beneficial results.
Working with BGAs who are committed to doing the right thing, actually investing in their businesses and focusing on strategic growth areas, allows both of us to win in the short and long term. This is our “narrow and deep” distribution strategy.
Improving administration and customer service systems. We’re spending a lot of time and money on improving our administration and customer service systems—it is critically important to us. We want to provide an LBL service experience that is so smooth and seamless it’s essentially unnoticeable. We want to be known as the best company in the industry from a service recovery perspective, but want to minimize those service recoveries by improving our manual and electronic processes.
To that end, we are committed to multi-carrier solutions. We are working on a few right now that could be somewhat transformational in the industry. The more expenses we can take out of the system the more profitable this business is for all parties. And, very importantly, it allows us to bring more value to the consumer. So our mission is to create efficiencies and work with those partners who are doing the same thing. Driving processing expenses out of the system and investing in sales, education and distribution will make us more profitable while also providing a better overall customer value.
Responding to emerging regulatory changes and the resulting challenges. The many regulatory issues, along with the muddling economic situation that we see, are problematic for us as a company and our industry. The regulatory environment, both at the state and federal level, is creating a significant amount of uncertainty.
We need to work very closely and diligently with the NAIC to put forth life insurance reserving requirements that are practical and reasonable, and allow us to continue to offer products with strong consumer value.
We also need to work within federal regulatory environments, specifically the tax writing committees, to make sure our products are understood and that we continue to offer products which provide consumers with an incredible safety net. That takes shape in the form of long term protection, life insurance (the inside buildup as well as the income-tax-free death benefit) and annuities with the inside buildup and the favorable exclusion ratio on annuity payments. We believe that all of these are important and do serve an incredible purpose. Our products allow families to maintain their integrity and livelihood upon the death of a loved one. Also, businesses are able to maintain their existence after the death of the owner or key employee. We can provide a very sound safety net for retirees in the form of a guaranteed income benefit—something rarely provided by private U.S. businesses.
Reinventing products to generate growth. Inventing and reinventing products is extremely important to us. I personally believe that as an industry we’ve gotten away from the art of identifying needs and opportunities to serve and, to a great extent, have lost the true value which we can bring to this marketplace. Consumers are not always looking for the best price on the spreadsheet; they’re looking for someone who understands what their needs are and offers a solution and often a product that fulfills their needs. We need to do more of that—understanding their needs and concerns and designing products that consumers cannot create on their own.
Our industry’s products provide peace of mind and protection, allowing individuals to sleep well at night. We are in an industry that is in the business of taking risk. We need to be prudent about the risks we assume and allow consumers to transfer these risks from their shoulders and minds to ours. And then we need to be there to back up those promises.
LBL’s plans for 2012. Our plans for 2012 are actually very simple. We want to deepen relationships with BGAs who are truly focused on a partnership type of relationship where there are common goals, objectives and a shared sense of winning. We want to design products that continue to provide very strong consumer values in the marketplace. We want to provide a service experience that is as good as any in the market. And, very importantly, we want to continue to be known as a company you can count on—one living up to its commitment of integrity, character and doing the right thing for our brokers, our producers and our policyholders. [LWD]
