Did you just lose your favorite fraternal?

I don't believe the persistsncy thing…

But
changing how agents are notified didn't help
Outsoursing didn't either
And no true ssb didn't help

so no i don't buy it.

love what they did
Memories we made on trips
And families i helped

but no wasn't what that email said
 
Not the first and most likely not the last company to do this. Life goes on.

It will be interesting to see how they decide to fund their future. Are they going to kill off that block of business?


It's their whole business. FEX did over $3 mil a year with them. The number 2 IMO did less than $500K.

But yes, companies come and go. We had an almost 9 year run with KSKJ.

Almost unheard of in FE. We had 6 years with RNA. That's an incredible long time.

Less than 2 years with Grange and GCU.

Settlers, Forethought and 5 Star all blew up. Americo too.

AmCon bit the bullet.

They don't all go out of business. Some just make their product unusable but hang around.

But we're still here. As for FEX, they are bigger than KSKJ. 3 times as many agents as them.

More volume than them. I'm 100% certain that FEX is going to be ok.

I have no idea what will happen to KSKJ.

I've got in excess of 1500 clients there. So I hope they survive for their sake.
 
Polish in very few states . How's their underwriting? As aggressive as kskj ? All these small CO's end up the same way . Agents key on them and shit all over them .
 
Didn't find the state map for PF but did read the KSKJ letter to National Underwriting Services. It appears the contract was due to poor persistency. How could this be? I thought if you were the cheapest on the block you could not be replaced and if you could not be replaced then your persistency shoild be above average.

You have to read carefully. It's easy to take it the way you did but no where does the letter say that National Underwriting had poor persistency. It says that the KSKJ product was priced in a way that they had to have higher than industry standards with persistency. Their standards were always very high and we met them every year until this year.

This year (I was first alerted in November) close to half of our agents that had earned their convention on sales volume had fallen below the 85% persistency. Those agents were mostly around 80% and while that is still good for most FE companies it's totally unacceptable the way KSKJ was priced. The other half of our agents ranged from 85 to 95% 13th month persistency. No one claims that National Underwriting Service had bad persistency by FE industry standards.

I think the main problem for them was that too much of their total business was with one product type (simplified issue whole-life) which is considered sub-standard business by the re-insurers and the huge majority of their business was through one agency. They have been trying to bring their new whole-life product to market for 2-years and it's my assumption that they were having trouble getting it approved due to those reasons.

I can't imagine any other reason that any company would cancel agents with 90 to 95% persistency, many of which don't even take advanced commissions just because some other agents had fallen below their required 85%. But that is just my guess. The reason they actually told me was they are moving entirely to a traditional fraternal-style of agent force. Meaning agents who work referrals from regional fraternal meetings and dinners. They said they do not want to work with agents who purchase any type of leads going forward. And that is why even our agents that had 85-95% persistency are not the type of agents they want to work with going forward. Because they buy leads instead of network referrals and their warm market.

Regardless we had a fantastic 9-year run with them. They were great to work with most of those years. This year had gotten a little different due to the drastic changes they made with their home office staff and sending all of their day to day administration to a third party vendor. That was not a smooth transition and was certainly the cause of any increase in policy cancelations as we had pointed out to them all year.

Overall I have nothing bad to say other than the way they handled their abrupt decision to completely change direction. I do not like that they had nearly 40 of our agents that worked hard for them all year to earn their convention trip and then took it away from them. That was not a classy way to handle that. They were actively helping agents with travel arrangements right up to the day before they sent them an email that they had canceled them. I can understand not wanting 80 people (agents and spouses) at your national convention telling your other agents that they won't be there next year. But I think they should have let our agents have their trip as planned and take the other 10 to 15 agents and staff at a separate date or to a different resort. They said they are going to give the agents compensation in place of the trip so that will be good if they do but it was still a slap in the face to agents that had worked hard for them and had a great relationship for many years.

We have a LOT of business on the books and as long as they keep paying our client's claims which they always have been great at and keep paying the agents their commissions that they are owed I accept that they just had to make a business decision and I hope they are successful in their new direction and stay as a great company for many years to come.
 
It's simple. Their rates were too low for their liberal underwriting. Even 95% 13 month persistency can't overcome not charging enough to compensate for risk.
If the rates were too low, then they are still too low because it is my understanding they are not pulling the product. They are simply returning their merketing model to a traditional life insurance model from a tradional FE model which consists or running leads.

I can see where that could improve overall persistency.
1)Warm market sales where the agent is a trusted relative or friend tend to be "stickier".
2) sales to dedicated Fraternal members are harder to replace. There was a good Woodman of the World presence in my area. It was hard to even get an appointment with those members who had bought into the WOW philosphy and attended regular meetings.
3)prospects that are aquired through warm market , referrals or even cold calling do not normally continue to shop meaning there are not a lot of expsure to replacement. On the other hand, those that send in leads continue to do so even once they have bought. That increases the possibility replcement will occur.
 
If the rates were too low, then they are still too low because it is my understanding they are not pulling the product. They are simply returning their merketing model to a traditional life insurance model from a tradional FE model which consists or running leads.

I can see where that could improve overall persistency.
1)Warm market sales where the agent is a trusted relative or friend tend to be "stickier".
2) sales to dedicated Fraternal members are harder to replace. There was a good Woodman of the World presence in my area. It was hard to even get an appointment with those members who had bought into the WOW philosphy and attended regular meetings.
3)prospects that are aquired through warm market , referrals or even cold calling do not normally continue to shop meaning there are not a lot of expsure to replacement. On the other hand, those that send in leads continue to do so even once they have bought. That increases the possibility replcement will occur.


^^Recipe for failure. None of their traditional agents have persistency better than mine.

Their plan is DTC. They think they have it figured out.
 
But we're still here. As for FEX, they are bigger than KSKJ. 3 times as many agents as them.

It would appear to be that simple. But they aren't going out of business. They are not changing rates and they are not changing underwriting.

FEX - I have zero doubt that FEX will still be here and will thrive. There may be an agent shake up, but that is normal with big changes.

KSKJ - were they lying then or are they lying now?

Smiling Faces....

Many of us have worked with 'agent friendly' 'business friendly' companies that changed or de mutualized.

Am I company / agency cynical or experienced?

Life goes on.
 
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