Central Coast Agent
Expert
- 54
That was the caption on the front of one of those free insurance industry magazines that you can sign up for online. I came home last week and my wife had pulled it from the usual pile of mail and set it on the kitchen table so I couldn't miss it.
I guess she is worried. I am not.
It now sits in the trash next to my desk. Basically, the impetus of the article was to recap how MLRs and Exchanges might affect Brokers in the future and how it is really too early to tell....but that things will surely change.
Really?
I've read a lot of doom and gloom predictions in these magazines and on this forum, and wanted to weigh in a bit on my observations as a fairly new Broker.
I started my independent agency 2 years ago after about 15 years of corporate sales outside the insurance industry. The recession was at that stage where people thought we could seriously just fall off the cliff economically. I was tired of trying to meet unrealistic sales goals in that environment and figured I could do better for myself.
Researching the insurance market, and thanks to a lot of advice from this forum, it was evident that Health Insurance would provide the fastest route to stability due to the demand of the product and higher commission levels.
It did. Within 18 months I was making as much as I did at my last job as a sales manager working at a Fortune 500 company. I thought that I could actually retire doing this. I made good money, I was helping people...nice...until March 23, 2010.
After that date, it seemed kind of silly to place all my emotional or business hopes on a product that could be legislated right out of my sales portfolio. Not knowing what is coming next is such a distraction and makes it hard to get motivated and prospect for new business.
Which leads to the point of this post...I'm not sure why in this industry, if one "product" is eliminated from your portfolio it portends the doom of your business. I have read so many posts that people will be "out of business".
I will analogize this situation to the legal industry. In the late 90's there was Workers Compensation Reform and later Bankruptcy Reform. Prior to this, there were attorneys that specialized in both of those fields of law. Did they close up shop when their business was suddenly reduced or eliminated as a result of this legislation?
No. Because they considered themselves lawyers first. WC or BK were simply specializations. Many of these lawyers simply boned up on new skills and became Family Law or Estate Planning attorneys. I was selling legal research materials to attorneys at this time, so I saw it first hand. It was difficult "starting over", but many became quite successful in their new field. A few vowed never to be specialists again and would run general practices...taking on all sorts of cases.
This time should be a perfect catalyst for Brokers to expand their product offerings. It is the very specialization and segmentation of product lines that is the cause for so much dismay in this industry. Identifying oneself as a "Health Insurance" Broker or "P&C" Broker could be part of the problem and is what creates the scenario for headlines reading "Are Brokers History?"
Instead, it would seem to me, taking a more generalist approach to ones business would seem to be an appropriate survival strategy in this legislative environment.
I will not be driven out of Insurance because one line of business is over regulated, because I consider myself an Insurance Professional first.
Going forward, Health may be the ancillary product that I sell along with other Business and Personal Insurance. Or, PPACA may be starved or repealed, and it stays my main product. But, whatever happens...Brokers will not be history because there are so many insurance products out there to sell...if you have the motivation to learn new things and take new chances.
In sailing terms...if your rudder fails, don't give up the ship.
Improvise.
(That being said...I do not think that CI, DI or other add ons to health insurance are going to make up the shortfall you will feel in health commissions...they are not demand products. My opinion is that you will have to become a true generalist to prosper. Possessing the ability to provide all types of insurance to your prospects: Auto, Home, Commercial, Workers Comp, etc.). Look at the most successful independent insurance agency in your community and read what they offer on their web page...it is everything....they are generalists).
I guess she is worried. I am not.
It now sits in the trash next to my desk. Basically, the impetus of the article was to recap how MLRs and Exchanges might affect Brokers in the future and how it is really too early to tell....but that things will surely change.
Really?
I've read a lot of doom and gloom predictions in these magazines and on this forum, and wanted to weigh in a bit on my observations as a fairly new Broker.
I started my independent agency 2 years ago after about 15 years of corporate sales outside the insurance industry. The recession was at that stage where people thought we could seriously just fall off the cliff economically. I was tired of trying to meet unrealistic sales goals in that environment and figured I could do better for myself.
Researching the insurance market, and thanks to a lot of advice from this forum, it was evident that Health Insurance would provide the fastest route to stability due to the demand of the product and higher commission levels.
It did. Within 18 months I was making as much as I did at my last job as a sales manager working at a Fortune 500 company. I thought that I could actually retire doing this. I made good money, I was helping people...nice...until March 23, 2010.
After that date, it seemed kind of silly to place all my emotional or business hopes on a product that could be legislated right out of my sales portfolio. Not knowing what is coming next is such a distraction and makes it hard to get motivated and prospect for new business.
Which leads to the point of this post...I'm not sure why in this industry, if one "product" is eliminated from your portfolio it portends the doom of your business. I have read so many posts that people will be "out of business".
I will analogize this situation to the legal industry. In the late 90's there was Workers Compensation Reform and later Bankruptcy Reform. Prior to this, there were attorneys that specialized in both of those fields of law. Did they close up shop when their business was suddenly reduced or eliminated as a result of this legislation?
No. Because they considered themselves lawyers first. WC or BK were simply specializations. Many of these lawyers simply boned up on new skills and became Family Law or Estate Planning attorneys. I was selling legal research materials to attorneys at this time, so I saw it first hand. It was difficult "starting over", but many became quite successful in their new field. A few vowed never to be specialists again and would run general practices...taking on all sorts of cases.
This time should be a perfect catalyst for Brokers to expand their product offerings. It is the very specialization and segmentation of product lines that is the cause for so much dismay in this industry. Identifying oneself as a "Health Insurance" Broker or "P&C" Broker could be part of the problem and is what creates the scenario for headlines reading "Are Brokers History?"
Instead, it would seem to me, taking a more generalist approach to ones business would seem to be an appropriate survival strategy in this legislative environment.
I will not be driven out of Insurance because one line of business is over regulated, because I consider myself an Insurance Professional first.
Going forward, Health may be the ancillary product that I sell along with other Business and Personal Insurance. Or, PPACA may be starved or repealed, and it stays my main product. But, whatever happens...Brokers will not be history because there are so many insurance products out there to sell...if you have the motivation to learn new things and take new chances.
In sailing terms...if your rudder fails, don't give up the ship.
Improvise.
(That being said...I do not think that CI, DI or other add ons to health insurance are going to make up the shortfall you will feel in health commissions...they are not demand products. My opinion is that you will have to become a true generalist to prosper. Possessing the ability to provide all types of insurance to your prospects: Auto, Home, Commercial, Workers Comp, etc.). Look at the most successful independent insurance agency in your community and read what they offer on their web page...it is everything....they are generalists).
