In a channel of the financial services industry in which advisors continue to feel minimal effects related to the recent recession, it should come as no surprise that satisfaction levels are on the rise in this year’s Insurance Advisor’s Report Card. Surveyed advisors dished out high ratings to their firms in the categories they rated to be of most importance: “firm’s/MGA’s ethics,” “firm’s/MGA’s stability” and “freedom to make objective product choices for clients.”
Says an advisor in Ontario with Woodbridge, Ont.-based Hub Financial Inc.: “When it comes to ethics, they are top-notch, otherwise I wouldn’t be dealing with them.”
An advisor in Quebec with Missis-sauga, Ont.-based RBC Life Insurance Co. says that having a sense of freedom is extremely important to the way he conducts his business: “We are able to recommend whatever is best for our clients, and we are able to do a good job because we are given total flexibility.”
To take the pulse of the insurance channel, Investment Executive researchers Fiona Collie, Anna Olejarczyk and Dinah Zeldin spoke with 393 insurance advisors at nine insurance firms. Advisors were asked to provide two ratings per category, one for the firm’s performance and the other indicating how important that category is to their business.
Advisors were asked to rate the categories on a scale of zero to 10, with zero meaning “poor” or “unimportant”; and 10 meaning “excellent” or “critically important.” Individual scores were then averaged for each category — both firm-wide and Report Card-wide. The “ IE rating” shows the average of all categories for each firm, while the “overall rating by advi-sors” is the average of how advi-sors rated their firms out of 10.
This year’s Report Card had some changes in the firms in the survey. Gone is Guelph. Ont.-based Co-operators Group Ltd.; it was determined that its business model — in which advisors focus mostly on selling property and casualty insurance — is no longer comparable with the other firms surveyed.
Co-operators’ departure has given way to Calgary-based PPI Solutions Inc. ‘s arrival. Formerly known as Financial Management Group of Cos. Inc., PPI Solutions had an impressive début, receiving top marks in 18 of the 26 categories that applied to the managing general agency.
And many of its advisors were excited about its recent partnership (as of February 2010) with Toronto- and Calgary-based PPI Financial Group Inc. Says a PPI Solutions advisor in Atlantic Canada: “Our strategic alliance with PPI Financial has added value to our strategic focus.”
PPI Solutions has 1,500 active insurance brokers that run their business through the MGA. And although it has partnered with PPI Financial and recently rebranded to include PPI in its name, the two firms will continue to operate as separate, independent businesses with separate management. PPI Solutions advisors praise their firm’s ability to provide cutting-edge technology, enhanced support services and monthly training sessions.
@page_break@Also receiving praise from advi-sors are Waterloo, Ont.-based Sun Life Financial (Canada) Inc. and the Vaughan, Ont.-based Canadian operations of
World Financial Group Inc. Both saw significant increases in their ratings.
“For new advisors, the training and the technology are second to none,” says a Sun Life advisor in Manitoba. “For a seasoned advisor, it’s a great culture to work in, as you have the freedom to run your own business and great tools.”
Both firms had run into problems in the 2009 edition of the Report Card, with scores dropping in a number of categories. However, both firms have managed to turn things around. Sun Life saw an increase in its ratings of half a point or more in 18 of the 33 categories that applied to it — as well as an increase in its IE rating to 8.4 from 7.7 in 2009.
Since last year, Sun Life has launched a suite of online tools — including an online advisor matching program, in which clients fill out their general information, then are matched with the advisor who best suits their needs.
“We have had tremendous success since we launched our new online tools in October,” says Vicken Kazazian, senior vice president of Sun Life’s career sales force. “I think there is a tremendous need out there [for financial advice], and people like to have control over who they select to be their advisor.”
Over the past year, Sun Life has expanded its wills and estate planning department by adding additional members; it also has launched a new tool that allows advisors to process documents with an electronic signature. Furthermore, the firm will launch its own mutual fund company this autumn.
WFG, for its part, has also seen major im-provements. Ratings in 12 categories increased by half a point or more. And its IE rating rose to 9.1 from 8.5. Says a WFG advisor in Alberta: “We are growing at about 30% a year, and we are really expanding our offices this year.”
A colleague in Ontario adds: “They know exactly where they want to go in the next five years. Our job is just to go out to families and service them.”
For the past year, WFG has been working on improving its technology platform. Says WFG president Richard Williams: “One of our core focuses was to enhance our technology platforms, and we are quickly moving forward with the launch of a number of industry-leading platforms.”
Struggling this year is London, Ont.-based Freedom 55 Financial, which saw declines of half a point or more in nine of the 33 categories that applied to the firm. Says a Freedom 55 advisor in British Columbia: “I have been waiting forever for a new contact-management system.”
Similarly, RBC Life saw declines in its ratings of half a point or more in eight of the 31 categories that applied to the firm, including the overall rating by advisors, which fell to 8.0 from 8.5. Says an RBC Life advisor in Ontario: “They treat us as if we’re not important, and it’s not just me who feels this way.”
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