According to a source, layoffs have occurred at Specialty Life Insurance (SLi), a wholesaler whose simplified issue life insurance products are underwritten by third parties.
In an interview with the Insurance Portal, Alexandr Dudarev, founder and CEO of Insurance Supermarket International Inc. (ISI), confirmed the layoffs without specifying numbers, explaining that an ongoing project requires realigning resources.
Dudarev says he distributes SLi products "in 50 states in the United States, and in all provinces in Canada." Based in the Greater Toronto Area since its inception in the 2010s, ISI encompasses SLi and Insurance Supermarket, a lead generation platform for advisors.
ISI is about to launch a distribution project where advisors will exclusively meet their clients digitally. Dudarev explains that some company functions were becoming redundant in the wake of this change.
Testing phase
ISI has nestled into a general agent model that generates leads for independent advisors located within a 15-minute drive of targeted consumers. If they accept, they must travel to the consumers to complete a transaction, sharing compensation.
ISI has maintained this digital distribution platform model through the network of independent advisors. Now, the insurtech aims to evolve towards a platform model that eliminates travel.
The revamped platform will enter a beta testing phase with the participation of subscribing advisors. "In Q1 2024, we’re launching our Ultimate Lead Program 2.0," reveals Alexandr Dudarev. "We’ll provide the advisors access to consumers with a platform where they are able to register for early access and be part of our beta group. We’ll send an invite to all our existing advisors, before it grows out to all the advisors nationwide," he adds. The CEO of ISI specifies that the launch will occur simultaneously in the United States.
Dudarev mentions that independent advisors will be able to transact directly with Insurance Supermarket or through their usual general agent, as is currently the case.
Departures and returns
Dudarev says the company is "shifting away from the traditional wholesaling model where the wholesalers meet with the advisors face-to-face and moving to more of a direct interaction with advisors."
Moving to a new distribution model, traditional distribution structures thus become redundant, explains Alexandr Dudarev. "As a result, the wholesalers, as well as some members of our operations, finance and product development that where supporting them got affected. As the new model takes shape, we are hopeful that we will recall some if not most of our teammates," states the CEO of ISI, SLi, and Insurance Supermarket. These three entities are chaired by Ray Mackenzie, a former executive of ivari.
Humania behind the products
Humania Assurance assumes the risk of SLi products distributed on the Insurance Supermarket platform. SLi has previously had two other underwriters. "Although the new program will initially focus on SLI products underwritten by Humania, we will however continue to support SLi products underwritten by Chubb and ivari within Canada," specifies Alexandr Dudarev. ISI distributes permanent and term life insurance products, critical illness insurance, and accidental death and dismemberment insurance.
He does not rule out the possibility of adding underwriters. "As we scale up, we intend to introduce additional products and carriers to all our advisors and consumers," adds Dudarev.
In the United States, ISI distributes Whole Life and Easy Life insurance products, underwritten by EMC National Life, as well as Independent American Plan, underwritten by American-Amicable Life (acquired by iA Financial Group in 2010).
Increasing productivity...
By eliminating the need to travel to the client, Ultimate Lead Program 2.0 aims to enable advisors to produce at their full capacity. "We fell that there is a more effective way of how to get the advisors to speak to the customers in real time," says Alexandr Dudarev. And this way, according to him, is to bring advisor and client together in real-time.
We can lead the advisor to speak to 3, 4, 5 customers a day. We will make their unproductive times productive. - Alexandr Dudarev
He estimates that clients no longer wish to receive an advisor at home. "If you’re looking for a life insurance, the most convenient way is to go on your computer and within half an hour, you’ll have a policy on your desk that meets your needs," he states.
Dudarev notes that the Insurance Supermarket system "asses the consumer needs, and asses the performance of the advisors and scores the conversation to ensure that the advisor did everything correctly." It also allows for increasing advisor productivity, according to Dudarev. "In the previous model, we were able to give the advisor maybe 10 appointments a month before it became too much work for him, and the performance started to go down. In the new model, we can lead the advisor to speak to 3, 4, 5 customers a day. We will make their unproductive times productive," he explains.
... And reach more people
The time saved by advisors will allow them to increase their income and insure more middle-class consumers, estimates Dudarev. "Everybody talks about serving the middle-market, but the vast majority of life premiums comes from high net-worth market. As an industry, our premiums go up, but the number of policies goes down," he laments.
Other industry sources raise the red flag on this situation. In an interview after his appointment to oversee all distribution networks of iA Financial Group in October 2023, Pierre Vincent stated that the number of life insurance policies sold in Canada decreased from about 700,000 to about 600,000 from 2010 to 2022.
Alexandr Dudarev will share more comments on underinsurance in the December issue of the Insurance Journal. We will also publish LIMRA data supporting the statements exchanged by Pierre Vincent, during the interview he granted to the Insurance Portal on October 19.
