Insurers place focus on improvements: Includes chart

The two insurers that made big strides since last year in the support services categories are Winnipeg-based Great-West Life Assurance Co. and Woodbridge, Ont.-based Hub Financial Inc.

Leander Dueck, senior vice president of individual distribution for GWL — which saw its ratings increase in three of the four support services categories year-over-year — offers a key reason for this growing trend. It’s the changing needs of an aging client base, he says: “Consumer dynamics are changing with an aging population, causing growth in the affluent and high net-worth markets and [in] estate planning needs. We are adapting our support structure to meet those needs.”

Dueck adds that GWL has a team of 15 tax and estate planning specialists who offer support to its advisors. “And by doing so,” he says, “we’re helping advi-sors meet all of their clients’ financial planning needs.”

John Lutrin, Hub’s chief marketing officer and executive vice president in Vancouver, says the reason the managing general agency saw an improvement of more than half a point in the ratings of each of its support services is because Hub advisors have started relying more heavily on those services, thus creating a growing demand for the services.

The MGA has on staff a team of three tax and estate planning specialists who focus on the high-end market and work with advisors on advanced cases, particularly at the point of sale.

“Our advisors were not looking to penetrate that market, but that is what happened,” Lutrin says of high net-worth clients. “Our core business still remains the mid-market, but this does not exclude our advisors from making good use of this resource when appropriate. These services have gained momentum and found success.”

A Hub advisor in Ontario says the firm’s insurance planning support staff “provide us with experts and scenarios for every client situation.”

A Hub advisor in British Colum-bia adds: “They really know the products. I get a quick response for anything I need.”

Lutrin says the trend toward more comprehensive support services for advisors is the upshot of an industry-wide shift toward a more independent sales force structure. As the number of insurers with dedicated sales forces decrease, independent insurance advisors are looking to MGAs for resources previously available through big companies, he says: “As a result, expectations of MGAs have risen, too.”

Judging by Hub’s improved scores, it appears the MGA is meeting its advisors’ expectations.

Another MGA that is stepping up its efforts is Toronto-based PPI Financial Group Inc., the leader of the pack in three of the four support services categories. PPI received strong ratings because it had made the decision to direct business toward the high net-worth market.

“We’ve been able to open up new markets that typical insurance advisors never thought were there,” says PPI chairman and CEO Jim Burton.

One example is using insurance in estate planning. “We’ve been able to do that by educating the marketplace, working with tax lawyers, accountants and advisors to say we can provide those amounts of liquidity,” he says. “For us to provide liquidity around $100 million to $150 million in an estate is something that was never thought of 20 years ago. It’s a huge market; it’s growing, and people in Canada have done really well.”

Another reason PPI advisors rated their MGA highly is because it ensures the quality of those services stays high by expanding them in concert with the growing number of associates with whom the firm deals.

“This means more underwriters’ actuaries, lawyers and accountants,” Burton says.

However, not all firms see the value in offering their advisors support for high net-worth clients, wills and estate planning, tax planning and insurance planning.

One such insurer is Guelph, Ont.-based Co-operators Group Ltd. Common complaints from its dedicated sales agents are that the firm isn’t doing enough, that the tools are outdated and that its support staff is inexperienced.

“There is some training and documentation available, but there is only one specialist,” says a Co-operators advisor in Ontario, “and that is not efficient for all of southwestern Ontario.”

@page_break@Dedicated insurance advisors at Mississauga, Ont.-based RBC Life Insurance Co., which has specialists in its head office to assist advisors, say the company has dropped the ball when it comes to providing guidance in the high net-worth area; they also complain that their employer sees no value in support for wills and estate planning.

“We don’t have a clear understanding of how to help clients with wills,” says an RBC Life advi-sor in Ontario.

Another RBC Life advisor in the same province adds that he doesn’t feel comfortable serving the needs of high net-worth clients unless his manager is there.

Despite these complaints, Ernie Murdoch, senior vice president of career sales for RBC Life, says the firm has no immediate plans to beef up its existing support services — although that may be something that the firm will look to add in the coming years.

“At the moment, we are satisfying the need,” he adds. “But as the organization evolves, I think there will be a growing need in that area.”

One positive aspect of RBC Life’s support services is that they’re offered to advisors free of charge. But while providing support services to advisors without cost does not necessarily ensure top marks, advisors say they appreciate tapping into those resources without triggering extra fees.

Likewise, Hub and Waterloo, Ont.-based Sun Life Financial (Canada) Inc. — the latter also was rated well in the support services categories — both offer these services without additional charges to advisors or clients.

A Sun Life advisor in Ontario says: “The estate planning department does not come from a sales perspective — and it is free to the clients.”

A Sun Life advisor in B.C. praises the insurer’s estate planning support as “a whole separate division that is very accessible.”

Hub’s Lutrin explains that offering support services to advisors for free helps them bring credibility and objectivity to clients. “Very often, life companies offer these resources to advisors, but they obviously come with their brand,” he says, noting that Hub’s support “is a resource advisors can take to their high net-worth clients with complete objectivity.”

He adds: “Advisors can position this person as a brokerage employee and, as there is no commission-sharing, it is not as if these specialists have a vested interest in closing the sale.” IE