Other than higher ratings than last year, the top priorities haven’t changed for advisors surveyed in Investment Executive’s 2006 Insurance Advisors’ Report Card.
Topping the list is ethics, with an importance rating of 9.6, up from last year’s score of 9.4. Tying for second at 9.4 is stability, which increased by 0.1 of a point in importance, and freedom to make objective product choices — which has the highest increase in the report, a whopping 1.4 points from last year’s 8.0.
That is not so different from what advisors told IE in the Brokerage, Planners’ and Account Managers’ Report Cards earlier this year. The financial services industry as a whole has a high service component, with the focus on strong core values and strong client/advisor relationships. So, it comes as no surprise that ethics, stability and freedom in product choice ranked as the most important aspects to the advisors surveyed in this year’s Report Cards.
And insurance advisors repeatedly touted ethics when they were asked what they consider to be the strength of the legal and compliance departments, the best aspects of their firm and the reasons they would recommend their firms to another advisor.
“Its devotion to ethics, professionalism and compliance,” says a West Coast advisor about the best aspects of Waterloo, Ont.-based Clarica Financial Services Inc. “It is very dedicated to the agents and treats clients fairly.”
Ethics also plays a large part in what the firms are looking for in the ideal advisor. “The people who do well manage to find that balance between empathy and ego drive, where they are empathetic to the needs of the clients and yet they have the ego drive and the desire for success,” says Jack Garramone, vice president of the Clarica sales force.
An advisor from The Co-operators Group Ltd. adds that his firm has taken great strides in ensuring compliance is met: “The CEO is supportive of ethics. It’s ingrained in our culture, our initial training and our sales training.”
PPI Financial Group‘s core 100 independent advisors who deal with the firm’s upscale insurance contracts rated their freedom to make objective product choices for their clients 9.3, slightly below the average. “There are no restrictions as to what our advisors can sell. They are completely independent,” says chairman and CEO Jim Burton in Toronto. It would seem that is the way the advisors want it.
PPI’s advisors have the freedom to go elsewhere for their products, but because PPI is well connected in the industry, advisors can work out specialized insurance packages. Says an advisor on the West Coast: “I go where my client is best served, and 99% of the time it is with PPI. It offers a great stable of products.”
Hub Financial Inc. advisors are also very confident that their clients are well served, rating the importance of their freedom to make objective product choices an almost perfect 9.8. “We’re concerned about remaining objective,” says John Lutrin, chief marketing officer and executive vice president in Vancouver for the Woodbridge, Ont.-based firm. “So that the product is based entirely on its merit and the best choice for the client. We’re there to enhance the advisor’s business.”
Rounding out the top three is a firm’s stability — and there is no doubt advisors like to work in a stable environment. When stating the best aspects of his firm, a State Farm Insurance Cos. advisor from the Prairies says: “It’s a stable company with a high level of integrity. The executives are open to listening to agents. There is good communication up the ladder.”
With the most recognizable slogan in the industry — and a history in the business dating back to 1874 — Freedom 55 Financial advisors rated their firm’s stability at 9.3. Asked if he would recommend the firm to another advisor, an Alberta rep says: “Absolutely, because of the corporate stability, brand recognition, training and support.”
At the other end of the spectrum, the advisors surveyed felt their companies’ Web sites (7.2), freedom to move firms (7.0) and purchase financing as it relates to succession planning (6.8) as the least important.
Many advisors feel their company Web site is doing nothing to promote their business. As an advisor at Great-West Life Assurance Co. on the East Coast says: “Nobody looks at it; nobody cares. It’s irrelevant.”
@page_break@A Clarica advisor from Quebec echoes those sentiments, adding, “I don’t get much business out of it, and not too many customers seem to look at it.”
Advisors sign on with a firm that fits their own strategic business focus, one that is stable, ethical and provides them with quality products to offer their clients. So, it is no wonder the score for freedom to move firms rated very low in importance.
“We can’t move around, but we don’t want to. We represent every fund company out there,” says a Freedom 55 advisor on the East Coast. IE