How COVID is changing the game for agents
There are really three main factors that have contributed to completely transforming our industry over the last three years.
Those three factors are COVID-19, private equity firms with consolidation and acquisitions, and contact center or call center growth.
We touched on COVID-19 in another post and how it has dramatically changed the industry. Not only consumer shopping and buying preferences, but also how agents are able to actually conduct marketing and local prospecting initiatives in their backyard. It’s been two years and we’re still seeing a lot of states, particularly blue states, in which there’s a lot of restrictions about face-to-face contact or going into facilities, holding group events or other types of activities. These restrictions are prohibiting agents from doing good work and being able to get in front of consumers in their local market. Many agents that we partner with are frustrated because of their lack of capital and trying to follow the CMS marketing guidelines. If agents cannot figure out how to continue to prospect and be effective they will eventually be phased out of the industry.
Another large component to the drastic changes to our industry are all of the private equity firm acquisitions to agencies, distributors, lead vendors, underwriters, and technology vendors. Things are starting to feel much smaller, and options much more limited. We’re already seeing carriers very much changing the guidelines and rules to agents or agencies being able to move or go to another FMO. We envision this scenario continuing to increase and apply to other carriers as this trend of acquisitions continues and private-equity firms continue to apply their leverage to influence the industry to their advantage, which is not to the advantage of the Medicare consumer or the independent insurance agent.
While agents are struggling to abide by all the marketing guidelines, COVID-19 restrictions and otherwise, you have publicly traded firms and private-equity firms that have incredible amounts of funding. There is almost no end in sight. It seems like almost weekly now, there are more announcements of acquisitions or funds that are being raised or invested into firms. Everyone is chasing the Silver Tsunami or the Baby Boomers! And these firms are able to heavily market through radio, TV, direct mail, internet, retargeting, back linking, buying traffic and many other means to get to the consumer. All the while hiring a lot of employees, seasonal workers, or poorly trained individuals to sit on the phone and attempt to provide in-depth analysis and consultation for Medicare consumers.
Some of the best, and most qualified agents with experience, are not successfully getting to the consumers. Rather these new agents or very inexperienced agents are the ones completing the transactions and providing the guidance to the Medicare consumers.
It’s an environment that is not very sustainable and has resulted in a huge increase in CMS compliance infractions over the past two years.
We are optimistic that there will be some significant changes to the industry to help curb some of these trends in the near future; but in the meantime, the industry is in need of very qualified Medicare professionals. Not part-time people who do Medicare sales occasionally on the side, and do it with seven other lines of business. It needs dedicated advisors who are very knowledgeable and are up to date with all the industry trends. The environment that we are in today is highly competitive and ever-changing.
Contact us today to receive guidance, updates, and ideas to boost your business in the evolving senior market insurance industry.