California Broker Magazine May 2019

Page 34


New industry trend provides opportunity for greater success for everyone



ccording to the Encyclopedia Britannica, in 1759, the Presbyterian Ministers’ Fund became the first life insurance company established in the American colonies. Six decades later, there were 17 stock life insurance companies in New York State alone and, by the early 1900s, life insurance was realizing steady growth in the United States. From 1920 to 1990, the industry was experiencing an 8.4% growth rate—what amounted to a 626-fold increase over that period. During this period, brokers were already becoming key members of the industry, forming relationships with both insurance buyers and the carriers with whom commissions were soon established. Historically and currently, relationships between brokers and carriers have been marked by a mutual dependency and the inherent tensions it often brings. Brokers’ expectations of carriers have evolved over the years and today center on matters surrounding pricing, enrollment processes, product education and marketing. The good news is that many carriers and brokers have been receptive to open exchanges that will advance enhanced relations and increased opportunities for both parties. One forum that is proving effective for this purpose is the carrier Broker Advisory Council. It is important for both carriers and brokers to understand the value proposition the right structured council offers in serving their interests and those of their mutual customers.


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MAY 2019

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