As an agency executive, one of the toughest part of my job then was to tell insurance agents vying for promotion that they are not ready for the agency leader’s role. It was tough because a number of these hopefuls joined the industry from the onset with just one goal in mind – to become an agency leader some day.
If not handled well, some of these agents may leave, thinking that they were being unfairly suppressed. And if agency management were to cave in, appointing them despite their shortcomings, many will end up failing.
And now that I am no longer in the industry, I thought it is a good time to pen my thoughts here so that those reading it will understand my take on this sensitive issue and realize that any advise given by their agency leaders or company executives should at least be considered seriously.
Some Facts on Survival Rate of New Agency Leaders
From past experience, only about 50% of all new agency leaders make it pass the first year in terms of meeting contract maintenance requirements. And more interestingly about 80% of those who fail, fell short because of one factor – recruitment i.e. they were not able to meet the recruitment targets required for contract maintenance. As I am already out of the industry, I have no idea if these figures are still valid but given my years of experience, I would believe that they still are.
Implications of Poor Promotion Decisions
What’s sad is that this often results in a lose-lose situation for all concerned. The agents lose out because their opportunity cost is usually very high; for them to even earn their promotion, they are likely to be above average producers. In some instances, we even see that the combined production of their whole newly formed agency is less than their individual production before their promotion.
Often such agency leaders are then asked by the company to step down i.e. to become agents again. Some unfortunately are not able to accept their re-designation of role and resign from the industry totally; a sad lost for the agent, their clients (who become orphans), the company and industry.
For those who are able to handle their step down, for some reason or other, many become just a shade of their former self, production wise at least. Of course there are exceptions but by and large, promotion of insurance agents ill prepared for the agency leader role often results in a sad ending.
Why Agents Sometimes Cannot Accept that They are Not Ready?
Sometimes, agents can become victims of their own success. There is a commonly held believe that it is not easy selling insurance and that if an agent can sell insurance well, he can sell almost anything. Some agents therefore become very confident of their own abilities, sometimes ignoring obvious signs that they are not ready, mistakenly thinking that things will work out on their own once they get their much coveted appointment.
How wrong these agents are! For if there is one thing more difficult to sell then insurance, it is the insurance career. And sadly many only realize this after being appointed in their new role and failing miserably.
So What Can be Done to Brighten the Prospects of Agency Leader Hopefuls?
A lot actually but because life insurers have different rules, practices and procedures for promotion of their agents, it is best not to rely on the company. Instead most of these preparations should be done by the agents themselves or with the help of their agency leader, if they are lucky enough to be recruited into a good agency. For more details on what can be done, look out for my next blog post.
Do Share Your Thoughts
I have shared my thoughts on promotion, as honestly as I possibly can. Now it is perhaps time you share yours, so that all seeking promotion can gain from our collective wisdom. Do feel free to give your comments below.
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