Originally Posted by GreenSky
I seem to recall they wrote a decent critical illness plan some years ago. Never wrote anything with them and I thought they just faded away.
Rick
Here is where I'm going with this. I met with the 'head guy" from a local agency (PM me if you want their URL. I don't want to make it public.)
The agency has about 30 agents in Sacramento and the San Francisco area combined.
Their market, so they tell me, is unique. They sell (mostly) worksite (voluntary) benefits to the very-small business... like the small auto mechanic shop with 3 or 4 people. They sell to a lot of blue-collar sole-props... painters, landscapers, handimen, mom/pop retail etc.
According to them, this is a market that Aflac and Colonial and others don't bother with as they are too small. (As a Colonial agent I can verify some of this. While we can write whatever group we want, Colonial tells us not to bother with groups under 15 lives, 20+ being an even better cut-off.)
Their crit illness, accident, and term life plans are not subsitutes for a major med... but they tell me most of these companies don't have (can't afford) MM. The average YEARLY premium collected for a case is around $500. This is penny-ante stuff but it is payroll-deduct and simp-issue.
OK, I'm skeptical, but these guys have been selling the Colorado Bankers
http://www.cbl-life.com/ stuff for 15 years and they do several million a year of permium (so they say.) They also sell Nationwide MM, but it's not their primary focus.
Their agents are not captive unless they take leads (appointments)... and only captive for work-sups... nothing else.
They do the UA model of setting appointments for their agents. They do not sell the leads. They tell me they close 3 out of 10 appointments. 25% of all appointments are no-shows. (Not sure how to reconcile the above stats.)
Commisisons are not great... around 40 to 50% of AP so we're talking about $250 per deal. But they say their agents do volume. They go to a 4-person biz and will write $900 to 1500 yeary prem total. They only write businesses that can show they've been around for 2 years and only employees who have been with company for 6 months. They say that really helps insure persistancy. They advance 9 months of the commission.
They run their own call center (I saw it... about 20 gals and a few verification people) and these folks have a good reputation in this area. I don't know if the CBL products are any good, which is why I posted this.
I'm not saying I'm going to sign on with these folks, but one thing I know for a fact. No one is calling on the micro groups, and these groups don't want nor can afford group MM, and none of the large work-sup houses (Aflac, et.al) want to mess with them either. These guys claim that they 'developed' the 'system' for this market (they explained to me their process.... from tele-lead to verif to sale) and it works for them. (You don't stay in biz for 15 years unless it does.)
As I see it, going after group MM in my area is a waste... the big brokers have them. Neither Colonial nor Aflac have a lot of traction here (this is a government town and the gov has great benefits). Individual health is crap-shot in CA (but still doable for the sole prop agent). Here looks like a market that is under everyone's radar... no underwriting, low cost items, etc.
I have the rate chart for their term life with crit. illness program. A 40 year old non-smoker can get $50,592 term life with a "living benefit" lump-sum critical illness rider (which pays a percentage (100%) of the DB for a whole bunch of bad things... heart attack, cancer, stoke, renal failure, etc.) for $10 a week ($520 a year).
Is that a good rate? Beats me. But having known tons and tons of micro businesses (dry cleaners, painters, yard men, small retail, etc.) I can see where this would interest them.
This agency has developed a market and system that seems to make money if it is 'worked.' That's all I know about it.
Are they taking a big piece of the AP? Yes they are because they secure the lead and they pay the telemarketer a bonus if a sale is made. Is this a good 'deal' for an agent? I have no idea. All I know is that they make money (they showed me the production stats and they have no reason to lie to me) and.... well I'm always open to something different.... selling into a market were there isn't as much competition.
That's it. Anyone working this micro-market?
Al
Colorado Bankers Life?
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