Property & Casualty aggregation
On the property and casualty side , the competitive landscape has caused P & C firms to focus on renewals and customer retention , with life insurance sales and other personal insurance lines representing less than 5 % to 10 % of revenues . We ’ ve seen record M & A and aggregator activity over the years coupled with the difficulties of the pandemic . These firms have had to navigate claims and exclusions , all while taking care of policyholders .
BGAs are realizing P & C professionals do not want to be seen as salespeople nor do they want to sell products that are not their core focus . Stopping what they are doing to license or train their team to sell life insurance or other lines can be a pain point . This is where BGAs can step in as a resource , but it often requires you to offer a different support model .
These are just some of the industry evolutions , to name a few . There ’ s a whole other set of challenges affecting the health and benefits sector . Collectively , these developments have shifted the marketplace for BGAs .
Doing business differently
Financial advisors and professionals are doing business differently and want to be perceived that way . There is a growing base of professionals who do not want to be selling products . They want to be known for the advice they provide ( and that advice should include risk management ). The problem is the way advice is delivered today does not always mirror the way BGAs have served advisors in the past .
The vast majority of advisors believe in the value of insurance and know that proper risk management planning is a crucial part of their fiduciary role . In rethinking the opportunities for BGAs , the answer is not convincing other advisors to write insurance . The answer may be for BGAs to incorporate more point-of-sale / solution offerings where they can write insurance directly with the advisors ’ clients , on behalf of the advisor .
The answer is not convincing other advisors to write insurance . The answer may be for BGAs to incorporate more point-of-sale / solution offerings where they can write insurance directly with the advisors ’ clients , on behalf of the advisor .
Distinction in the marketplace
The BGA model is arguably one of the most expansive , objective , and unbiased resources in the independent insurance industry today . BGAs don ’ t have to choose sides . They can support agents and advisors who write insurance and those who do not ( but wish to offer insurance for their clients ).
BGAs scope the universe of carriers for the most advantageous underwriting offers , without proprietary obligations . They have created and embraced technology to accelerate risk management planning , case submissions , and the underwriting process .
BGAs are able to offer no-load and fee-only risk management products , if they so choose , and they are able to write insurance cases on behalf of an advisor . It truly is a distinct model , and pointof-sale / solution offerings can be a game changer for serving other sectors of the marketplace . It doesn ’ t mean changing the BGA model completely ; it is simply expanding your opportunities .
A new value proposition
BGAs have decades of technical insurance knowledge , carrier insights , and the ability to consult on planning concepts with , and on behalf of , the advisor . If you add a point-of-sale / solution as part of your model , this may allow you to further help advisors in honoring their fiduciary role and enhancing their client experience . www . nailba . org 41