Deloitte Life Insurance Producer Survey: Carrier Support Key to Loyalty and Revenue Growth in Face of Market Demands

Nearly two thirds of producers expect to add or drop carriers within next 12 months

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Nov 16, 2011, 11:46 ET

NEW YORK, Nov. 16, 2011 /PRNewswire/ -- Sales support, speed of underwriting and policy issue, and carrier brand are the top factors influencing a producer's decision to place business with a specific carrier, according to Deloitte's "Voice of the Producer: Life and Annuity Producer Survey."

"Producers are the gatekeepers of the life insurance and annuities industry," said Rebecca Amoroso, vice chairman, Deloitte LLP and insurance leader. "It is essential carriers leverage this channel to spur growth in a mature industry. Yet on issues they believe are most important to sales, 40 percent of producers are not satisfied with the support they currently receive. However, with more than 80 percent of their total compensation coming from two favored carriers, there is room for improved producer loyalty and sales through better support."

The survey reveals opportunities for carriers to create new relationships with producers since many are seeking stronger support or are looking to add or drop carriers. Roughly two-thirds of producers surveyed expect to change carriers within the next 12 months. Twenty-nine percent plan to add carriers and one-third expect to both add and drop carriers.

As a result, carriers must develop strategies to attract producers seeking new carriers while retaining current ones. Based on the four common producer "personas" uncovered by the survey, these strategies deliver competitive support aligned with producer priorities. The personas are based upon account producer demographics, practice characteristics, career stage, attitudes, intermediary relationships and business attributes that characterize them and identify those most likely to be influenced by carrier initiatives to improve placement factor.

"If they want to retain current producers and attract new ones, carriers should develop a strategy that targets them according to their sales priorities and growth potential while offering practical solutions aligned with their market approach and client base," said Rick Berry, director, Deloitte Consulting LLP and the producer survey leader.

The four producer personas uncovered by the survey are:

Speed Merchants

Speed Merchants rate speed of underwriting and policy issue as a top placement factor and value a carrier's ability to issue a policy quickly as a selling point with clients. Speed Merchants produce large numbers of policies with smaller premiums and therefore value an easy process for new business and rapid turnaround in issuing policies. Carriers must have strong operational capabilities to meet the requirements of Speed Merchants.

Carriers targeting these producers should continue to improve and automate their business processes and invest in IT infrastructure. They should also consider capabilities in predictive analytics to support fast, correct underwriting decisions.

Consummate Sellers

Consummate Sellers value carriers that provide superior sales support in proposals, advanced underwriting, and assisted wholesaling. The sales process for Consummate Sellers tends to be more complex since they sell investment-oriented products, like annuities, to older, more affluent clients.

Carriers focused on Consummate Sellers should consider what types of enhanced sales support they offer including dedicated service representatives for higher-value clients. They should consider upgrading their call centers with better technology, increased staffing, and expanded hours of operation to enhance producer support. Improving call center operations may also require investments in IT systems, business process redesign, and improved training.

Volume Sellers

Being relatively new to insurance, Volume Sellers are focused on building their business and interested in teaming with carriers that can send them high quality leads.

To identify potential leads, carriers will likely need strong capabilities in predictive analytics and data mining applied to demographic and financial data. They may also need to capture information from call center and online enquiries, perhaps requiring additional staff and investments in IT systems.

In developing incentives for Volume Sellers, carriers should consider using lead realization rates.

Brand Aficionados

Brand Aficionados are producers who place high importance on the brand when choosing a carrier.

Serving Brand Aficionados effectively requires carriers to have core capabilities in marketing, advertising, and public relations to increase the likelihood that their brand messages are widely and effectively communicated to consumers. When designing incentives for Brand Aficionados, carriers may consider rewarding producers for driving potential customers to marketing and sales events held by the carrier, which will help sustain brand awareness.

A copy of the report is available on Deloitte's Web site at: www.deloitte.com/us/VoiceOfLifeInsuranceProducer

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