The last annuity incentive trip that I took was to Cabo San Lucas a few years ago. That horrible experience led me to send my wife and children in my place to subsequent "annuity atta boy" excursions to numerous exotic travel destinations. My wife and kids loved it!
For someone like me who doesn't drink alcohol and is on a strict diabetic diet, these "get togethers" bring absolutely no value to me because most events revolve around too much food and way too much booze. The staged meetings are typically worthless pep rallies, and I find that agents don't normally like hanging around me and my "bluntness," which is understandable.
The bottom line is that I am officially done with these trips regardless of how many I qualify for in the future, and I think the annuity industry should be done with them as well…and for obvious reasons. Before you start screaming, hear me out.
Glorified travel agencies?
How did we get here as an industry? How did most FMOs turn into glorified travel agencies? What is the point?
I know that sales groups have always used incentives to "motivate" the forces. That doesn't mean that it's right. This practice has been around a long time in the annuity industry, but has recently been totally cleaned up on the securities side. (I went on those trips as well back in the day, so what I am proposing is doable.)
In my research for this column, I called numerous FMO and carrier contacts that I have and asked them why they keep trying to outdo their competitors with these trips and incentives. The answer across the board was depressingly consistent. The answer was that they all felt it was what the agents wanted, and if they took these incentives away, they would lose business. Really? Are annuity agents that shallow and myopic that a primary part of their decision to choose an FMO or product is some trip to Hawaii or Mexico? FMOs and carriers swear that this is true. I hope not, but unfortunately, it probably is.
So let's examine this issue from an agent's standpoint. We all can agree that the client's best interests should be at the center of an agent's business model. As a continuation of that thought, agents should always find the exact product to match up with the specific situation and goals of the client regardless of the commission. So if those client-focused points are true, then why do agents need incentives? Isn't the commission enough? I welcome those arguments.
From an FMO's or carrier's standpoint, there needs to be leadership to change the status quo. Again, it is doable, and the securities industry is a recent example of being able to clean up this incentive madness. One of the problems with incentive trips, iPad giveaways, etc., is that those "goodies" are always based on sales volume. That "hit the number" system has the potential to put the agent's needs ahead of the client's in order to qualify for the trip or gift. That involuntary temptation is not a good thing in a sales environment.
