Allianz 222 Fixed Indexed Annuity

[nathan.lee]

Perhaps for some and that's a real shame. I can think of only one agent who submits business here that writes exclusively preferred business. He never calls for case design or info. He has written 9.3 million of the 360. I'm sure Allianz loves him haha. However, I'm happy about the fact that pretty much everyone else with us writes at least two carriers (out of the contracts we have). I was just saying that not nearly all preferred agents just write Allianz business (or even any Allianz for that matter).

@SanDiego619, comment was designed not to highlight the results of these types of practices on independent agents and advisors, but rather to shed light on the unspoken intentions of carriers.

First let's identify the basic difference between a captive carrier and the independent channel. Carriers that appoint IMO/FMOs, who then appoint independent agents are part of the latter group. Carriers that OWN and CONTROL the products and distribution to consumer are captive...agreed? Allstate agents sell Allstate products right?

Insurance carriers are for profit companies, many are public companies with shareholders and as such they need to behave in a manor that generates increasing revenue and profit. Best ways to increase profits are to increase revenue and/or decrease costs. One way to increase revenue is to incentivize a sales and distribution channel. ALL carriers that pay a commission to an agent, advisor, and/or FMO are providing an incentive to their sales and distribution channels. Some carriers provide more than just commission. This comes in the form of deferred comp plans, benefits, leads, incentive trips, etc.

Let's do this mental exercise, Carriers that operate within the independent channel begin to purchase a portion of the distribution in the form of IMO/FMO's. Those same carriers begin designing (more attractive) products exclusively for their "preferred" distribution channel. The "preferred" distribution channel is highly incentivized to recommend the "preferred" line of products which their new owner created AND in turn incentivizes the agent/advisor to recommend these same products to consumers. Deferred comp, benefits, etc. are designed to reward continuous production, appreal to the independent agent/advisor and can be very difficult to leave behind.

Now you have a carrier that OWNS and CONTROLS the products, the 1st level of distribution, and has an agent base hooked on rich incentives tied to continuous production. Philosophically not terribly different than a captive companyright?

I'm not suggesting that captive companies are bad or that one carrier is better than the next. I just believe that we shouldn't be naive when it comes to the behaviors and intentions of the carriers, IMO/FMOS, and agents within our industry.

 

[SanDiego619]

@SanDiego619, comment was designed not to highlight the results of these types of practices on independent agents and advisors, but rather to shed light on the unspoken intentions of carriers.

First let's identify the basic difference between a captive carrier and the independent channel. Carriers that appoint IMO/FMOs, who then appoint independent agents are part of the latter group. Carriers that OWN and CONTROL the products and distribution to consumer are captive...agreed? Allstate agents sell Allstate products right?

Insurance carriers are for profit companies, many are public companies with shareholders and as such they need to behave in a manor that generates increasing revenue and profit. Best ways to increase profits are to increase revenue and/or decrease costs. One way to increase revenue is to incentivize a sales and distribution channel. ALL carriers that pay a commission to an agent, advisor, and/or FMO are providing an incentive to their sales and distribution channels. Some carriers provide more than just commission. This comes in the form of deferred comp plans, benefits, leads, incentive trips, etc.

Let's do this mental exercise, Carriers that operate within the independent channel begin to purchase a portion of the distribution in the form of IMO/FMO's. Those same carriers begin designing (more attractive) products exclusively for their "preferred" distribution channel. The "preferred" distribution channel is highly incentivized to recommend the "preferred" line of products which their new owner created AND in turn incentivizes the agent/advisor to recommend these same products to consumers. Deferred comp, benefits, etc. are designed to reward continuous production, appreal to the independent agent/advisor and can be very difficult to leave behind.

Now you have a carrier that OWNS and CONTROLS the products, the 1st level of distribution, and has an agent base hooked on rich incentives tied to continuous production. Philosophically not terribly different than a captive companyright?

I'm not suggesting that captive companies are bad or that one carrier is better than the next. I just believe that we shouldn't be naive when it comes to the behaviors and intentions of the carriers, IMO/FMOS, and agents within our industry.

I don't disagree with much of that at all. I would argue that there aren't many incentives on the FMO side. Our override is pretty dang close whether the business is preferred or not (it may have been different at gameplan since the ownership is a little different than our FMO. There are certain products that you don't get bonuses on but thats really more the SPIA and fixed ann side. Are there incentives for the agents? Heck yes. Like I was saying earlier, I don't think thats a bad thing. I think carriers would be stupid not to incentivize agents to write their products. My whole point.... Get contracted under the program if you qualify. They really do have some great products available. Avoid getting appointed with an insurance carrier through an FMO that is owned by that carrier (ie. Your old employer). As an agent (if you use the advise of a product specialist at an FMO) it has to be up to you to find a company that truely recommends what's right for the client. That's the bottom line right? I don't care if the carrier offers you 10% commission on a product, it's up to the agent to write the best product for what that client is trying to accomplish. If its a preffered product then cool, if its Great American, AEI, EQ, or whoever that's cool too. You have to at least have the products available for yourself to sell.

The companies that push product will not and do not last. I've seen it so many times with agents who have left us to start their own FMO/AFMO. People think that because their group of 5 people write 50 million in Allianz (again just the example) that it means they can do this business. I'm getting off topic. I mostly agree, I just argue that its not wrong on the part of the carrier. The end of the day, the agent is appointed with them and the agent decides what to write. They have an actual choice, unlike an Allstate.

 

[nathan.lee]

I don't disagree with much of that at all. I would argue that there aren't many incentives on the FMO side. Our override is pretty dang close whether the business is preferred or not (it may have been different at gameplan since the ownership is a little different than our FMO. There are certain products that you don't get bonuses on but thats really more the SPIA and fixed ann side.

As the COO of an FMO (or DMO rather), I am fully aware of the compensation to IMO/FMOs. Firesales, production bonuses, comp breaks per age or state, etc.

Are there incentives for the agents? Heck yes. Like I was saying earlier, I don't think thats a bad thing. I think carriers would be stupid not to incentivize agents to write their products.

By your own admission you're 23 and have been working at an FMO for 6 months so I won't come down on you too hard for this one. This is a very dangerous concept and is one of the primary reasons that annuity sales (and sales people) are often villified in mainstream media. When a carrier or FMO offers an incentive to an advisor, the carrier or FMO provides a reason for the agent to NOT do what is best for the client but what is best for him or herself. As wholesalers we often say "Do what is best for your client" out of one side of our mouths while saying, "If you write this product you'll get X, Y, and Z" out of the other side. The most consternating part of this is that the overwhelming majority of wholesalers and agents DO WANT to do what is best for their client and simply convince themselves that the incentive doesn't sway the decision. Are there ways to incentivize wholesalers and agents without putting the consumer at risk? Absolutely! Are these types of incentives exciting or even as quantifiable as those in use today? Not even close.

So MY WHOLE POINT is that there are only so many pennies in a dollar and the more pennies that are used to incentivize distribution and agents the fewer pennies that are used to create benefits for the consumer. Simply math...

You're enthusiasm and passion are great so keep that up. I just want to open your eyes a bit to the larger picture which will help you be a greater resource for your clients and a better advocate for your industry.

 

[Josh Landis]

As the COO of an FMO (or DMO rather), I am fully aware of the compensation to IMO/FMOs. Firesales, production bonuses, comp breaks per age or state, etc.



By your own admission you're 23 and have been working at an FMO for 6 months so I won't come down on you too hard for this one. This is a very dangerous concept and is one of the primary reasons that annuity sales (and sales people) are often villified in mainstream media. When a carrier or FMO offers an incentive to an advisor, the carrier or FMO provides a reason for the agent to NOT do what is best for the client but what is best for him or herself. As wholesalers we often say "Do what is best for your client" out of one side of our mouths while saying, "If you write this product you'll get X, Y, and Z" out of the other side. The most consternating part of this is that the overwhelming majority of wholesalers and agents DO WANT to do what is best for their client and simply convince themselves that the incentive doesn't sway the decision. Are there ways to incentivize wholesalers and agents without putting the consumer at risk? Absolutely! Are these types of incentives exciting or even as quantifiable as those in use today? Not even close.

So MY WHOLE POINT is that there are only so many pennies in a dollar and the more pennies that are used to incentivize distribution and agents the fewer pennies that are used to create benefits for the consumer. Simply math...

You're enthusiasm and passion are great so keep that up. I just want to open your eyes a bit to the larger picture which will help you be a greater resource for your clients and a better advocate for your industry.

Well said Nathan Lee.

 

[SanDiego619]

As the COO of an FMO I am fully aware of the compensation to IMO/FMOs. Firesales, production bonuses, comp breaks per age or state, etc.



By your own admission you're 23 and have been working at an FMO for 6 months so I won't come down on you too hard for this one. This is a very dangerous concept and is one of the primary reasons that annuity sales (and sales people) are often villified in mainstream media. When a carrier or FMO offers an incentive to an advisor, the carrier or FMO provides a reason for the agent to NOT do what is best for the client but what is best for him or herself. As wholesalers we often say "Do what is best for your client" out of one side of our mouths while saying, "If you write this product you'll get X, Y, and Z" out of the other side. The most consternating part of this is that the overwhelming majority of wholesalers and agents DO WANT to do what is best for their client and simply convince themselves that the incentive doesn't sway the decision. Are there ways to incentivize wholesalers and agents without putting the consumer at risk? Absolutely! Are these types of incentives exciting or even as quantifiable as those in use today? Not even close.

So MY WHOLE POINT is that there are only so many pennies in a dollar and the more pennies that are used to incentivize distribution and agents the fewer pennies that are used to create benefits for the consumer. Simply math...

You're enthusiasm and passion are great so keep that up. I just want to open your eyes a bit to the larger picture which will help you be a greater resource for your clients and a better advocate for your industry.

You're in line with what I'm saying. When I say that I think carriers would be stupid not to offer incentives I'm not arguing it's the best thing for the industry. I am saying they would be stupid not to because there is always someone (a carrier) out there who will offer them and it has to be done for their business. It's the best thing for the carrier. I said I don't think its bad. I guess that wasn't the best wording. I should have said that I completely understand why they do it. It's like FMO's and sharing override. As the COO of RIN I would assume you agree there are better things to do with our override then shell it out amongst producers? (Heck I don't know if you guys even share your override, but most do these days so that's why I'm guessing.) I'm not saying producers shouldn't be rewarded for their business of course but you know how many other things that money can be put into to probably help producers even more in the long run. However, there's that FMO out there that said "hey want an extra percent of commission?" So people had to adapt and start programs to compete with that. The real shame for our industry is that there are too many FMOs that just don't offer a great level of service but they're shelling out override to keep producers around. Luckily there are select few that do great with both, but you get the point.

 

[scagnt83]

I would never market the product saying to expect double digit gains. I never said you should expect that. I would be the first to say that over the course of the contract you may be closer to an average of 4-5%. My point was simply (with that 50% bonus) it can definitely happen. Even if it happened once or twice, that's awesome. My point was I wouldn't say someone was capped at just 4.25% each year.

I always do a 50/50 mixed with that and a monthly cap. This allows for double digit (in a good year for the market) gains with 150% quite easily. So 6.38% is not the highest you can go by any stretch of the imagination.

Your intent might have been to say that there is a chance for gains over 4.25% with other crediting methods. But you did a very poor job saying it initially....

When you make comments that insinuate a product can easily go past 6.38%.... and it has a 4.25% Yearly P2P Cap... well, that is just asking for trouble.
I will refer back to Nathans comments about "only so many pennies in a dollar".

To expect drastically different results from different crediting methods on the same product is foolish. It can happen using monthly crediting, but it is not often.

Also, I would suggest running some monte carlo type scenarios on the Monthly P2P.
It does have the greatest possibility of gains. But it is also the most inconsistent crediting method. With the largest likelihood of a zero year.

This is why the NAIC strongly recommends that you should refrain from comments or insinuations that Monthly crediting methods will give double digit returns.


And to address the original point that you were responding to.
I was simply making a comparison to other products. And was illustrating that there were other products with comparable crediting methods available on the market. Which is true.

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If I'm being honest again, my company doesn't have to market these Allianz preferred products. We have done well over their production minimum to be a preferred shop for over 12 years (I know preferred hasn't been around that long. I am just making a point on the steady production.)

Which is why you guys let most any agent in the Preferred program. Which is great. But not all IMOs do mostly Allainz business. So just because your shop does it one way does not mean that it works like that everywhere.

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My opinion on these products come from studying these things and seeing how many different scenarios they fit. I get there are people that hate Allianz. I can't tell you how many stories I have heard from people about their bad experiences. The real shame though? When I hear an agent talking about how Allianz didn't let them write a case for suitability reasons and they blew their sale. So that agent decides they are never going to write them again. (This is really for any carrier. Just using this as a specific example). People need to separate themselves and their hatred for a company for reasons like that. Study the products and decide if they fit clients you work with. If you decide it's not a fit then that's ok. I am not saying this is yours or anyone's experience on here. Just things that I come across.

Ummm.... historically in this industry Allianz does not have a good reputation for being strict on suitability.

I realize you are green. But Allianz has gotten stricter with suitability over the past few years because they have had the sh#t sued out of them for thousands of unsuitable sales to seniors.

Because you work for a shop that pushes a lot of Allianz... Im sure that you guys have had agents that have run up against their stricter guidelines and dont like it.

But for most agents its not the strict suitability that is a problem.
It is because of the way they conduct themselves as a company!


I have said this before on this forum. I have never had a case where Allianz was a clear winner on product. I have considered them a time or two. But it seems I can always find something just as competitive. It might pay a bit less.... but I still eat well.

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I would argue that there aren't many incentives on the FMO side. Our override is pretty dang close whether the business is preferred or not (it may have been different at gameplan since the ownership is a little different than our FMO. There are certain products that you don't get bonuses on but thats really more the SPIA and fixed ann side.

Pretty dang close is a relative term in the annuity game.

If you dont think that experienced producers know what the comp structure is out there you are mistaken. We do.

It is undeniable that IMO comp structure plays a HUGE role in recommendations from that IMO.

Now some do a good job at being non-partial. But that is the minority by far.

If I call up 20 major IMOs for a case, I would bet that Allianz, Aviva, & AE will be the top recommendations.

I have had IMOs flat out tell me "If you switched your business to Aviva you could make close to 50% more..." and they werent just talking about a single case either...

I had a major IMO VP tell me that "If your not writing Allianz your leaving money on the table in your business".


The reason Allianz has the most IA sales in the industry is because they are heavily marketed by IMOs.
They are heavily marketed by IMOs because of the comp structure. Plain and simple.

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Are there incentives for the agents? Heck yes. Like I was saying earlier, I don't think thats a bad thing. I think carriers would be stupid not to incentivize agents to write their products.

It most certainly can be a bad thing for consumers.

You work with agents, so your mindset is different.

But excessive comp to incentivize production is a poison to this industry.
And IMOs that help foster that business model are part of that poisonous problem.


Great American has had large sales volume over the past couple of years.... even after lowering their comp!!!

Why is that???

Because it is a competitive product that is consumer friendly and easy to explain.

I can make a hell of a lot more money with a competitive product, than I can with competitive comp.


There is a reason that the DOL & SEC have been working to redefine the fiduciary laws and what scope they encompass. The annuity industry is in danger of that scope including IRA transactions.... comp based sales incentives only make the regulators see the need for this even more...

Comp based incentives only make regulators regulate us more. And it makes the public perception of us worse... and often they are right to think that... especially if an agent is being paid significantly more to market one product over the other. (something that historically Allianz is famous for)


When industry comp is more standardized, and companies compete on PRODUCT, it will be a good day for consumers and agents.
(maybe not good for all IMOs though)

 

[SanDiego619]

Your intent might have been to say that there is a chance for gains over 4.25% with other crediting methods. But you did a very poor job saying it initially....

When you make comments that insinuate a product can easily go past 6.38%.... and it has a 4.25% Yearly P2P Cap... well, that is just asking for trouble.
I will refer back to Nathans comments about "only so many pennies in a dollar".

To expect drastically different results from different crediting methods on the same product is foolish. It can happen using monthly crediting, but it is not often.

Also, I would suggest running some monte carlo type scenarios on the Monthly P2P.
It does have the greatest possibility of gains. But it is also the most inconsistent crediting method. With the largest likelihood of a zero year.

This is why the NAIC strongly recommends that you should refrain from comments or insinuations that Monthly crediting methods will give double digit returns.


And to address the original point that you were responding to.
I was simply making a comparison to other products. And was illustrating that there were other products with comparable crediting methods available on the market. Which is true.

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Which is why you guys let most any agent in the Preferred program. Which is great. But not all IMOs do mostly Allainz business. So just because your shop does it one way does not mean that it works like that everywhere.

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Ummm.... historically in this industry Allianz does not have a good reputation for being strict on suitability.

I realize you are green. But Allianz has gotten stricter with suitability over the past few years because they have had the sh#t sued out of them for unsuitable sales to seniors.

Because you work for a shop that pushes a lot of Allianz... Im sure that you guys have had agents that have run up against their stricter guidelines and dont like it.

But most agents do not dislike Allianz because of strict suitability.
It is because of the way they conduct themselves as a company.


I have said this before on this forum. I have never had a case where Allianz was a clear winner on product. I have considered them a time or two. But it seems I can always find something just as competitive. It might pay a bit less.... but I still eat well.

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Pretty dang close is a relative term in the annuity game.

If you dont think that experienced producers know what the comp structure is out there you are mistaken. We do.

It is undeniable that IMO comp structure plays a HUGE role in recommendations from that IMO.

Now some do a good job at being non-partial. But that is the minority by far.

If I call up 20 major IMOs for a case, I would bet that Allianz, Aviva, & AE will be the top recommendations.

I have had IMOs flat out tell me "If you switched your business to Aviva you could make close to 50% more..." and they werent just talking about a single case either...

I had a major IMO VP tell me that "If your not writing Allianz your leaving money on the table in your business".


The reason Allianz has the most IA sales in the industry is because they are heavily marketed by IMOs.
They are heavily marketed by IMOs because of the comp structure. Plain and simple.

First things first. I wasn't pitching the product to a client so why you're telling me how dangerous it is to use the wording I used doesn't seem as valid. Even taking into account the quotes you put on here, I never said someone should expect double digit gains. I was simply stating to you (not a client) that it was very possible (even if unlikely). Even in my bad wording I stated it would take a good year in the market. The only reason I even said that was because from your post you made it seem like a number above what you stated was unobtainable. I agree the product should never be pitched that way.


We don't just "let" producers become Allianz Preferred. Allianz is the one who decides what producer can be a preferred agent (based on the previously stated requirements). We just file the paperwork. If you were ever told other requirements from another IMO (like a yearly minimum) they should have their preferred contracting revoked. Also, like I stated we don't do mostly Allianz. We do just as much AEI (they're actually our number one carrier this year) and almost as much Equitrust.

My suitability story was just an example. One that (as someone who is on the phones all day with agents) I have heard 2 or 3 times. I am in no way saying this is a trend. My point was that its a shame when producers decide not to write a carrier based on something that does not negatively affect a client.


I have never said Allianz is always a clear winner or ever for that matter. I stated that there are times when their products are a fit and it's a shame when people don't want to see that. Again, this 100% applies to any carrier. Allianz happens to be the topic. If you or any agent decides there is truly a better product then that's perfect. I am again just saying that is not always why a decision is made and that's a shame.

I wasn't trying to hide comp structure. We send it out to all of our agents. Sorry for the general statement.

I bet that you have heard your leaving money on the table. That really sucks that is what a lot of major companies say. However, this was never a topic that I brought up. Like the response I just said to Nathan. I understand why Allianz uses incentives, I didn't mean to communicate that is the reason you should write them. I'm sorry if you took anything I said in this way.

We don't sell much Aviva these days (if any). The buyout from Athene (if I'm remembering correctly) has us a little turned off from them. Therefore I could not comment on why other IMOs might tell you that.

I'm sorry a VP told you that about Allianz. I don't claim that competing companies don't pitch it this way. It really is no good for the industry. The other half that's sad about that is that is exactly what some agents want to hear.

I apologize if I upset you for correcting your mistakes about the product and the platform. I was not trying to personally attack you. I was just stating corrected information.

When I'm actually recruiting, if I mention Allianz and I hear "I don't like Allianz." I reply with something along the lines of "haha. That's no big deal, there are plenty of great carriers." I honestly could care less if someone doesn't want to write Allianz, but I do think it stinks when it's for the wrong reasons (again not saying this is you).

The arguing here boils down to my love of being the other side of the argument.

Clearly you don't think Allianz being number one is from them being a good company. Can I ask who should be number one in your opinion. Just out of curiosity, no argument.

Hopefully spelling and stuff is write. My 3 month old is sleeping on me. haha

 

[scagnt83]

First things first. I wasn't pitching the product to a client so why you're telling me how dangerous it is to use the wording I used doesn't seem as valid. Even taking into account the quotes you put on here, I never said someone should expect double digit gains. I was simply stating to you (not a client) that it was very possible (even if unlikely). Even in my bad wording I stated it would take a good year in the market. The only reason I even said that was because from your post you made it seem like a number above what you stated was unobtainable. I agree the product should never be pitched that way.

It is dangerous when talking about the product period. Using the words "quite easily" and "double digit gains" in the same sentence is a red flag.

It also is not accurate.

In a volatile bull market (think 2009 or 2010) the MP2P can very easily return zero.


And again, I was simply making a comparison between that product and other options out there on the market.

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I wasn't trying to hide comp structure. We send it out to all of our agents. Sorry for the general statement.

You send them the FULL comp structure... including overrides???

That is the problem with the comp based incentive model and all of the ambiguity behind it. Many producers have no clue that an IMO is pushing a certain carrier over another because they get paid more for doing so.

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We don't sell much Aviva these days (if any). The buyout from Athene (if I'm remembering correctly) has us a little turned off from them. Therefore I could not comment on why

Well Athene's comp structure is not as lucrative.....

They also are new, so hopefully thats it.


I was told this prior to the buyout. And if I remember correctly it was an IUL discussion. Different product, but same mentality by the IMO.
And Aviva's IUL is not a good product.

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I apologize if I upset you for correcting your mistakes about the product and the platform. I was not trying to personally attack you. I was just stating corrected information.

Oh I actually appreciate you correcting my mistakes. Most of us here are here to learn.

Clearly I do not sell Allianz. So I was just pulling up what info I could quickly find on the product.

Allianz is famous for the 5 year min payout after a 10 year surrender. The company material I found made it seem like that was the case.

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Clearly you don't think Allianz being number one is from them being a good company. Can I ask who should be number one in your opinion. Just out of curiosity, no argument.

The one with the best product for the situation.

That is how a true independent agent works.

There is no "best" annuity company.


Allainz is #1 in sales. Not necessarily in quality.
Historically, GM has had the highest volume sales in the world for cars... is GM better quality than BMW or Mercedes?

And is a Mercedes necessarily better than a BMW? Or does it depend on the person and their situation?


Most agents do have companies they prefer over others. But a true indy agent likes a company because their products are competitive and consumer friendly.

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The arguing here boils down to my love of being the other side of the argument.

Yes, but you have no perspective when it comes to how the Allianz structure compares to a captive structure (which is what started this part of the discussion).

I have worked in a captive environment. So when I make the comparison I actually have life experience to compare it to.
(I started at NYL)


I might have been misinformed on some of the finer details.
There seems to have been a disconnect with the min premium requirement (I thought it was Allainz premium only).

But the mindset and intent is still very much the same.
And I stand by my comments that it is an attempt to make agents quasi-captive as much as possible.


The fact that the IMO must commit to a larger than usual min premium just filters down to the agents and how they are marketed to.

Sure some IMOs already were hitting those numbers.
But the increased comp for writing preferred business is an attempt to get them to push Allianz even more.

A quick google search provided a Preferred Contract. The IMO has the ability to get a full 100bps over base override... in the world of overrides that is a lot.


And IMOs that were not at those numbers already, but offered Allianz, then felt pressure to market the products more so that they could become Preferred IMOs and not loose business to competition.


Its captive by incentive. And once you have bought into the incentive structure, it usually pays you more the more you keep with it.



There are plenty of NYL agents out there that write plenty of outside business. But that does not mean that the NYL biz they write is not done so because of the incentive structure provided. A lot of the experienced agents still write it over other carriers purely because of the incentives.


Hell, most IMOs promote the Preferred program through comp!

Allianz Preferred financial professionals will receive:

Performance-based compensation on Allianz Preferred products
Increasing compensation grid based on total annuity production from Allianz Preferred and non-preferred products
Enhanced service experience

comp comp comp.... come get a higher comp than the other guys pay... Its the Allianz way...

They dont market the product/service features until the last sentence. Obviously its just one example. And I dont lump all IMOs into the same boat.
Actually, there are a few IMO owners who I have great respect for. A couple of them are even here on the forum.


In short:
It is one thing to correct a misstatement. It is another to argue a point that you have no real life perspective of.

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I am actually on here to learn. I'm 23 and I have been in this business for 6 months (been around it all my life, but worked here for 6 months). So I even understand I will say some things that are incorrect. That's why I read this stuff.

Keep up your enthusiasm. Being at an indy IMO will give you a decent knowledge of the industry if you stay with it. But just remember that you dont know what you dont know.

Your enthusiasm for the products your IMO pushes is actually a good thing. It is the best way to succeed at your job.
Just remember that your IMO, the way they do things, the things your exposed to; it is only one piece of the puzzle that is the annuity market. And do not loose sight of the bigger picture on an industry level.

This can be a very rewarding industry for a motivated 23 year old.... I know from experience... I started at the same age.
And congratulations on the new baby!

 

[SanDiego619]

It is dangerous when talking about the product period. Using the words "quite easily" and "double digit gains" in the same sentence is a red flag.

It also is not accurate.

In a volatile bull market (think 2009 or 2010) the MP2P can very easily return zero.


And again, I was simply making a comparison between that product and other options out there on the market.

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You send them the FULL comp structure... including overrides???

That is the problem with the comp based incentive model and all of the ambiguity behind it. Many producers have no clue that an IMO is pushing a certain carrier over another because they get paid more for doing so.

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Well Athene's comp structure is not as lucrative.....

They also are new, so hopefully thats it.


I was told this prior to the buyout. And if I remember correctly it was an IUL discussion. Different product, but same mentality by the IMO.
And Aviva's IUL is not a good product.

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Oh I actually appreciate you correcting my mistakes. Most of us here are here to learn.

Clearly I do not sell Allianz. So I was just pulling up what info I could quickly find on the product.

Allianz is famous for the 5 year min payout after a 10 year surrender. The company material I found made it seem like that was the case.

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The one with the best product for the situation.

That is how a true independent agent works.

There is no "best" annuity company.


Allainz is #1 in sales. Not necessarily in quality.
Historically, GM has had the highest volume sales in the world for cars... is GM better quality than BMW or Mercedes?

And is a Mercedes necessarily better than a BMW? Or does it depend on the person and their situation?


Most agents do have companies they prefer over others. But a true indy agent likes a company because their products are competitive and consumer friendly.

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Yes, but you have no perspective when it comes to how the Allianz structure compares to a captive structure (which is what started this part of the discussion).

I have worked in a captive environment. So when I make the comparison I actually have life experience to compare it to.
(I started at NYL)


I might have been misinformed on some of the finer details.
There seems to have been a disconnect with the min premium requirement (I thought it was Allainz premium only).

But the mindset and intent is still very much the same.
And I stand by my comments that it is an attempt to make agents quasi-captive as much as possible.


The fact that the IMO must commit to a larger than usual min premium just filters down to the agents and how they are marketed to.

Sure some IMOs already were hitting those numbers.
But the increased comp for writing preferred business is an attempt to get them to push Allianz even more.

A quick google search provided a Preferred Contract. The IMO has the ability to get a full 100bps over base override... in the world of overrides that is a lot.


And IMOs that were not at those numbers already, but offered Allianz, then felt pressure to market the products more so that they could become Preferred IMOs and not loose business to competition.


Its captive by incentive. And once you have bought into the incentive structure, it usually pays you more the more you keep with it.



There are plenty of NYL agents out there that write plenty of outside business. But that does not mean that the NYL biz they write is not done so because of the incentive structure provided. A lot of the experienced agents still write it over other carriers purely because of the incentives.


Hell, most IMOs promote the Preferred program through comp!


comp comp comp.... come get a higher comp than the other guys pay... Its the Allianz way...

They dont market the product/service features until the last sentence. Obviously its just one example. And I dont lump all IMOs into the same boat.
Actually, there are a few IMO owners who I have great respect for. A couple of them are even here on the forum.


In short:
It is one thing to correct a misstatement. It is another to argue a point that you have no real life perspective of.

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Keep up your enthusiasm. Being at an indy IMO will give you a decent knowledge of the industry if you stay with it. But just remember that you dont know what you dont know.

Your enthusiasm for the products your IMO pushes is actually a good thing. It is the best way to succeed at your job.
Just remember that your IMO, the way they do things, the things your exposed to; it is only one piece of the puzzle that is the annuity market. And do not loose sight of the bigger picture on an industry level.

This can be a very rewarding industry for a motivated 23 year old.... I know from experience... I started at the same age.
And congratulations on the new baby!

Yes we'll send them what our override comp structure is when they are receiving part of that override. (Doesn't include preferred products since we can't share that override anyway). As I was saying earlier, we would prefer not to have to share the override so we could invest that back into the business to create even more resources, but that's just the market in the FMO/IMO world today.

I don't know why Athene's comp being lower would have effected whether we wrote Aviva this year as Aviva had remained the same. Another main reason we don't really write them is when they started getting into proprietary products. That's just not something we believe in (This is also something Athene does).


I get that there isn't a best annuity company nor was I arguing that I think Allianz is. However, there is usually a company that an agent will be partial to. I rarely find it to be the case that business will be split evenly between more than a few carriers. I was just wondering what you have written the majority of (as it stands for this year). That would be why I asked who you think should be number one.

Like I said, I have been around it my whole life. Without going into detail I am well aware of a captive environment.

Again, I wouldn't argue that their incentives are good for the industry (the same way override sharing isn't great for the FMO industry). My point was simply, they are smart to do it. It clearly works for getting them business. By your own admission, you don't write their products so I don't know how you would be able to comment on their current service or products. It's not some B rated carrier that has been around for 5 years. My grandma is able to still be in her house right now because of an Allianz policy that she holds. No, I'm not saying Allianz is the only carrier that would have done this for her. However, it happens to have worked out fantastic for her so far.

We hate that other FMO's promote things this way so I'm in agreement there. One of those things I guess. Some agents really are just after the money. It's sad, but its true. Another truth? All Insurance carriers are in it for the money. No matter what they say. I'm sure there are carriers that really do care about people, but money is first to them. I don't know if that is at all arguable.

Thanks for the congrats!

 

[Norwayguy]

Yes we'll send them what our override comp structure is when they are receiving part of that override. (Doesn't include preferred products since we can't share that override anyway). As I was saying earlier, we would prefer not to have to share the override so we could invest that back into the business to create even more resources, but that's just the market in the FMO/IMO world today.

I don't know why Athene's comp being lower would have effected whether we wrote Aviva this year as Aviva had remained the same. Another main reason we don't really write them is when they started getting into proprietary products. That's just not something we believe in (This is also something Athene does).

What is a proprietary product other than something only some IMOs and agents can offer. Isn't Allianz Preferred similiar in that way?