Education took a direct hit in this year’s Insurance Advisors’ Report Card. Advisors at every firm but one gave lower ratings this year for ongoing training than last year, while the percentage of advisors holding professional designations also dipped.
Training appears to be a major bone of contention, with an overall drop of 0.3 points from last year to an average of 7.4.
“MGAs don’t offer a lot of training,” laments one independent broker in British Columbia. Advisors at The Co-operators Group Ltd., gave their firm an above-average 7.7 for training, but still showed a high degree of frustration. “They’re doing their best, but you might have to drive 100 miles to get it,” says one Saskatchewan advisor.
The lone exception to the trend was at Great-West Life Assurance Co., whose agents rated training 7.3, a jump from last year’s last-place score of 7.0 but still below the survey average this year.
Joan Prevalnig, Great-West’s vice president of resource centre operations, credits the improved score with the firm’s “multi-faceted” approach. “The training is available to those who are new to the business as well as to those who have been around for 35 years,” she says.
Great-West has 26 resource centres across Canada for agents to gather product information and learn how to market themselves. The Winnipeg-based company also hosts annual “congresses,” open to all advisors. These are two- or three-day workshops paid for by the advisors and geared toward their specific areas of interest.
Prevalnig says the continuing education program encourages agents to maintain standards by reimbursing advisors the full course fee upon successful completion.
Meanwhile, the certified financial planner is still the most important designation, with 32% of advisors surveyed this year saying they have it and another 31% working on obtaining it. That is down from last year’s 36% who had it and 33% who said they were working toward it, but it is is difficult to say the drop is based on time constraints or simple disregard.
“I’m too busy to write the CFP,” says an Ontario agent at Freedom 55 Financial. “Some people think that designation is so important, and others don’t give a damn.”
Only 24% of those surveyed said they have their chartered life underwriter, down six percentage points from last year. Another 17% have their chartered financial consultant designation, vs last year’s 22%.
London, Ont.-based Freedom 55 takes top marks for the range of services offered. Every one of Freedom 55 agents surveyed said they offer retirement planning, while 91% offer financial planning (35% of whom have their CFP), 84% offer estate planning and 42% do tax planning (edged out slightly by independent agents, at 43%).
Retirement planning is the most popular service, offered by 85% of all insurance advisors surveyed; tax planning was the least popular, offered by only 36% of advisors.
Cross-licensing among insurance advisors saw a slight decrease this year as well. The number of advisors holding both life insurance and mutual fund licences was down two percentage points to 73%.
John Whaley, executive director of the Independent Financial Brokers of Canada, predicted last year that the prevalence of cross-licensing may wane, and he was right. “I think we got into a period in which it became apparent that the returns weren’t what clients were looking for,” Whaley says, citing the rough year in the markets. “I think some folks are saying, ‘To heck with it, I’m not going to bother renewing my mutual fund licence’.”
The fees associated with the Mutual Fund Dealers Association are also costing agents money, and many are unhappy about it. “I gave up my mutual funds licence last year, and it was the best thing I ever did,” says an Alberta advisor with Equinox Financial Group.
The life licence qualification program may also be to blame. The single-step licensing system became mandatory Jan. 1, replacing the former two-tiered licensing process. The LLQP was implemented to ensure that new agents had the practical skills demanded by the current insurance environment.
It’s too early to tell if the new standard is dissuading agents from obtaining a life licence, but Grant Swanson, director of licensing and compliance at the Financial Services Commission of Ontario, says a slight decrease in applicants wouldn’t be surprising.
So far, more than 2,000 exams have been written in Ontario alone, and that number is expected to rise. “We’re starting to see fairly significant numbers of people coming through [the licensing process].”