Producer Recruiting Slump Nips Aflac's U.S. Sales

(Related: Aflac Aims to Compete Harder for Dental and Vision Business)

Executives from the Columbus, Georgia-based insurer talked about their interest in live-human agents and producers today, during a conference call the company held to go over its latest earnings with securities analysts.

Earnings

Aflac helped created the modern supplemental health insurance market in Japan, and its operations in Japan are much bigger than its U.S. operations.

The company as a whole is reporting $777 million in net income for the third quarter on $5.5 billion in revenue, compared with $845 million in net income on $5.6 billion in revenue for the third quarter of 2018.

Aflac Japan is reporting $838 million in pretax adjusted earnings for the latest quarter on $3.9 billion in revenue, up from $756 million in pretax adjusted earnings on $3.8 billion in revenue for the year-earlier quarter.

Aflac U.S. is reporting $335 million in pretax adjusted earnings for the latest quarter on $1.6 billion in revenue, compared with $334 million in pretax adjusted earnings on $1.6 billion in revenue.

U.S. Performance Indicators

Here's how some key Aflac U.S. results changed between the third quarter of 2018 and the latest quarter:

• Sales: $344 million, down 4.2%
• Premiums for In-Force Coverage: $6.1 billion, up 1.5%
• Sales Commission Spending: $145 million, down from $146 million
• Average weekly agents and brokers producing sales: 7,085, down 5.4%

Although the average weekly producer count fell, average commissions per weekly producer increased about 5%, to about $18,600 per average weekly producer, according to ThinkAdvisor calculations based on Aflac data.

Executive Comments

Daniel Amos, Aflac's president, said he thinks his company's drop in U.S. sales was due partly to the ending in the second quarter of a partnership that had not been profitable.

Another reason for soft sales was a strong economy, Amos said.