Manulife, Sun Life strike another blow to sales-based recognition conferences

In addition, Toronto-based Sun Life Financial Inc. has indicated that it may soon follow suit, as it recently notified its top advisors that it will be reviewing and adjusting its own recognition program, called the Strategic Partner Program.

These revelations come approximately two weeks after Winnipeg-based Great-West Life Assurance Co. (GWL) and its Toronto-based sister company, Canada Life Assurance Co., announced plans to phase out their volume-based incentive conferences. The companies said they would redirect resources toward programs focused on development and education rather than recognition, with costs shared by the advisor.

See: GWL, Canada Life will discontinue recognition conferences

The wave of changes follows a report on life insurance distribution that the Canadian Life and Health Insurance Association Inc. (CLHIA) recently published; the CLHIA report called for changes to these types of incentive trips. Specifically, the report said that since travel incentives could contribute to a “perception of a conflict of interest,” independent advisors should be required to pay their own travel and accommodation costs associated with such conferences.

In an email statement sent to Investment Executive (IE), Sun Life said it agrees with the notion that independent agents should cover their own costs. “Sun Life is supportive of this direction,” the statement says.

According to the insurer’s memo to advisors, it plans to align the company’s Strategic Partner Program with the new CLHIA recommendations. Sun Life said it would provide more details around the new recognition program parameters in the next few months.

In the meantime, Sun Life said there will be no change to its upcoming 2016 Practice Development Summits, taking place at various different locations, or its 2017 Premier Partner Conference, taking place in Cannes, France in October 2017, as the qualification period is already underway.

Similarly, Manulife said in a statement to IE that it plans to follow through with scheduled conferences in which the eligibility period has already begun. It will host its last recognition conferences in 2018.

Although Manulife expects to continue with its educational Investment Forum and Elite Forum conferences, the insurer said it might consider making changes to those programs “to align with best practices.” The changes to advisor rewards and recognition, Manulife said, are part of a broader review of its approach to various practices.

Leslie Byrnes, vice president of distribution and pensions with the CLHIA, addressed the issue of recognition conferences at the Canadian Association of Independent Life Brokerage Agencies’ national conference in Niagara-on-the-Lake, Ont., on Wednesday.

Specifically, she said that although the CLHIA has not heard any consumer complaints about the recognition conferences, it’s important for the insurance industry to address the perception of a conflict in this area.

“Clearly, when an advisor has a choice between various insurers where they can place the business, conference incentives can contribute to a perception of a conflict of interest,” Byrnes said. “Other industries have already tackled this area, and we would suggest that the time has come for our industry to do so, as well.”

CLHIA’s report suggests that in cases of dedicated sales forces, it would not represent a conflict for insurers to continue to cover advisors’ travel costs for trips with “reasonable professional content.” In addition, it says managing general agencies (MGAs) should be allowed to offer expense-paid conferences.

“MGAs could offer trips, provided that qualifying for that trip wasn’t tied to placing business with any particular insurer,” Byrnes said.

Representatives with Manulife and Sun Life were not available for interviews with IE.

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