persevere through challenges / BRO Vector

Advisors in the insurance space are more satisfied with their agencies than they were two years ago, according to Investment Executive’s (IE) 2021 Insurance Advisors’ Report Card. The majority of the firms surveyed saw slight increases in their IE ratings — the average of all of a firm’s category ratings.

The Report Card, which took a hiatus in 2020 due to the pandemic, assessed the sentiment of insurance advisors at seven firms for 2021: three dedicated sales agencies (DSAs) and four managing general agencies (MGAs). The advisors surveyed, who either worked for one of the DSAs or ran their business through one of the MGAs, collectively gave the firms an average IE rating of 8.6, up from the 8.2 collective rating that was recorded each year from 2017 to 2019.

Across the board, firms continued their efforts to boost advisor support, despite — and in some cases because of — the past year’s tough environment. The performance averages of far fewer categories dropped significantly (by half a point or more) compared with 2019: only five categories dipped, versus 18 two years ago. Meanwhile, the number of categories with ratings that rose significantly held relatively steady, at 30 for 2021 compared with 31 two years ago.

Strong efforts by the DSAs and MGAs throughout the past 18 months played a large part. When asked to rate the pandemic support provided by their agencies, advisors gave an average rating of 9.2 out of 10 — with no firm rated below 9.0. Agencies were broadly praised for their adaptability and compassion, with one RBC Life Insurance Co. (RBCI) advisor in Ontario saying, “There’s been so much mental health training. The pandemic helped us know each other even better.”

The three best-performing categories for 2021 were the same as two years ago and had similar ratings: “Ethics” (9.6), “Freedom to make objective product choices for clients” (9.4), and “MGA’s compliance regime support” (9.3). However, several categories jumped onto the list of the 10 best-performing, due to significantly improved ratings compared with 2019. That group included “DSA’s reputation with clients & prospects” (9.1, up from 8.3), “Strategic focus” (8.8, up from 8.3), and “Effectiveness in keeping advisors informed” (also 8.8, up from 8.3).

What’s notable is both the strategic focus and feedback effectiveness categories remained just as important to advisors as in 2019 (rated 8.8 and 9.0 for importance in 2021, respectively, compared with 8.7 and 9.0 — about the same as two years ago) — and they were both areas in which the Report Card’s top firms stood out. (See related story.)

The top three firms by IE rating were all MGAs: PPI Management Inc. (rated 9.2, up from 9.1 in 2019); IDC Worldsource Insurance Network Inc. (IDC WIN; 9.1, down from 9.2); and Hub Financial Inc. (8.9, up from 8.5). Hub led in the strategic focus category with a rating of 9.5, up significantly from 8.5 two years ago, with the other two firms not far behind. PPI and IDC WIN tied for first in the feedback effectiveness category (both rated 9.3, about the same as in 2019) and Hub came in second place at 9.1, up from 8.6.

Another common thread among the three agencies was the high praise by advisors for management. For example, a Hub advisor in B.C. said, “I also really love how they reach out and always make sure we’re happy. The leadership team is young and always striving for better.” That MGA had significantly improved ratings in eight categories and its IE rating rose the most out of all firms for 2021, reflecting this sentiment.

Similarly, an IDC WIN advisor in Ontario said, “The personal touch you get here and the culture [are] great, where people work hard and they care for their advisors.”

Many PPI advisors pointed to robust continuing education and back-office support. (PPI led in the “Ongoing training” category at 9.4, and had above-average results in all three back-office categories.)

As a group, the MGAs outpaced their DSA peers in 2021, with an average collective IE rating of 9.0, compared with 8.1 for the three DSAs collectively.

The Achilles heel of the DSA group seemed to be lack of back-office efficiency. All three firms received below-average ratings across the “New business (application processing),” “In-force policy owner services” and “Commissions support” categories.

The MGAs saw some weakness in the technology-related categories (e.g., “Technology tools & advisor desktop”), and so they weren’t immune to criticism. But the advisors surveyed rated the back-office categories as more important to their businesses than general technology.

Back-office pain was acute this past year. As one Canada Life advisor in Ontario said, “The back office for investments is in turmoil and Covid made it worse.” (The Canada Life group includes advisors from both Freedom 55 Financial and the firm’s Wealth and Insurance Solutions Enterprise, or WISE, network. Both use the agency’s Advisor Solutions platform.)

Meanwhile, an advisor in Quebec with RBCI said, “There are a lot of inefficiencies that get in the way of doing business.”

Executives at both firms are working on improvements.

“We’ve enhanced many of our capabilities to enable business,” said Rob DeMott, senior vice-president, Advisor Solutions with Canada Life. “Whether that be through e-signature, increasing insurance limits, relaxing underwriting guidelines and rules … the pandemic really accelerated our implementation and development of technology,” which was already a focus following the company’s 2019 consolidation of its three insurance subsidiaries.

As for RBCI, while its back-office had shortcomings, the DSA saw significantly improved ratings in eight categories, including technology tools and strategic focus.

“We became a digital insurer overnight,” said Mike Hamilton, RBCI’s senior vice-president of insurance sales, distribution and marketing, reflecting on the pandemic. “[It was] a big shift for everyone. It [turned] what was probably a three- to five-year plan [into] a one- to three-month plan.”

Advisor business support has remained paramount, he added, saying, “We’ve invested quite a bit in our business development area, and we’re actually going to be building that out a little bit more [in 2021].”

At Sun Life Financial Distributors (Canada) Inc. (SLFD), the Report Card’s third DSA, advisors gave significantly higher ratings in 11 categories compared with 2019. The firm’s IE rating rose to 8.1 from 7.9 two years ago, even though it was one of the lowest in this year’s Report Card.

“I’m very happy with Sun Life. They have work to do, but they recognize that and they seem to be committed,” said one of the agency’s advisors in Alberta.

Rowena Chan, president with SLFD, said that the company is building out its digital tools and financial planning support. “Financial planning has been a key focus for Sun Life,” she explained. “Our advisors, [as of July], have delivered 30% more financial plans this year than in 2020.” Furthermore, due to digital tool enhancements and continuing education support, more of the firm’s advisors are pursuing planning designations.

Read our full methodology.