The Changing Look of Life Insurance Distribution











How life insurance producers can ride the waves of disruption

By Dave Donchey

As any good surfer knows, waves come in sets. Within each swell, energy bonds together and then travels in sets or groups of waves. In this way, they can conserve their energy as the waves travel over the vast ocean.

The same could be said of trends in the insurance industry.
The waves of technology will continue to hit the shores of your business. The question is, will you be ready for the waves? Will you be intimidated by them? Or will you grab opportunity by the horns and ride that wave all the way into shore and beyond?

The main disruption in our industry is driven by technology, and it’s impacting everyone involved: the carriers who build products and issue policies, general agencies who process them, life insurance producers who sell them and customers who buy them.

If you learn how the progression of technology’s effect on carriers and General Agencies impacts you, the life insurance producer, you can learn how to ride the wave of disruption.
If you’re not informed about every aspect of your business, then the internet WILL take over your company.


Carriers have many concerns as technology is changing how consumers interact with insurance products. Being profitable is crucial and carriers are taking advantage of technology to reduce their costs. E-applications, drop tickets, and accelerated underwriting are a few examples of processes carriers are implementing to lower their costs.

Life carriers also used to be primarily responsible for insurance producer education, as most producers were tied to a specific carrier. Carriers took that role seriously, and ensured that their agents knew the ins and outs of their products and services. Today, however, carriers have reduced or eliminated many of their training resources (and no longer offer agents an education stipend). To add fuel to the fire, more and more insurance producers are independent, and the various types of people who can sell life insurance (like investment advisors, CPAs, and health insurance agents) have further fragmented training and education.

A number of life insurance carriers are also creating direct-to-consumer platforms like Haven Life (which is owned by MassMutual), Prudential, Protective and others, because frankly, it might be a lower-cost model for certain demographic buyers. However, life insurance products are complicated and there is still an important benefit to having producers help sell larger and more technical policies. And some people need and want the skills of a good insurance producer to give them the right guidance.

In summary, life carriers are fighting a few different forces, looking for ways to lower their costs, increase their margins and, and be a sustainable leader in the business.


General Agencies

General Agencies have largely become responsible for producer education and training, acting as the middleman between carriers and agents.

This scenario is complicated, however, by a few factors:

  • A large number of producers are autonomous and not directly tied to a carrier. Individuals who can now sell life insurance include investment advisors, property casualty agents, CPAs licensed to sell insurance, health insurance producers, and so on.
  • The independent producer might be part of firm that sells many types of products, but the producer is responsible for his own training. What he or she knows about life insurance products is minimal, and in many cases, largely self-taught.
  • Producers are not as well trained as they once were (by carriers) and they are generally not proactive about seeking help. They’re busy trying to be successful and grow their business, but it’s much more difficult to do it alone out of their home office or independent firm. Finding time to drive across town and attend a training session is a challenge. Unfortunately, many insurance producers have lost sight of the value of education and training.

General Agencies have to be more nimble and innovative, taking advantage of technology to be able to educate producers—and do more to reach out and build connections with independent producers.


Producers have been hit hard by the incoming technology waves. Consumers are changing the way they shop for products, and life insurance is no exception. They can hop online, research, and now, even buy life insurance products from sites like Haven Life. By the time a consumer contacts an insurance agent, they’ve likely already done their homework.

This is an enticing process, because consumers “don’t know what they don’t know.” They only see a low policy premium and what appears to be a simplified process, and as a result, see little value in what an agent can provide (especially when what life insurance producers have to offer is information consumers don’t think they need or already know how to search for).

So how do you counter the disruption that technology is having on the consumer’s view of the value you bring to the table? If you’re a well-equipped producer, and you’re knowledgeable and informed, you can absolutely show consumers the story behind every spreadsheet. Or why a particular insurance company is ideal to work with. Or why you would recommend a different product or policy.

It all comes down to maintaining a high level of training

If producers want to remain relevant and not be replaced by a computer and a website, they have to be more sophisticated. And that happens by learning the trade—well. It takes becoming an expert about products and processes, and using tools that will enhance business.

Here’s where YOU can harness technology to your advantage. Instead of having to drive across town and spend an entire day at a seminar, you can participate in a short “Lunch and Learn” or watch a video or webinar—taking advantage of all possible resources to be proactive about your education and training.

Technology can also help you broaden your base of offerings, so that changes in any one segment of the industry won’t hurt your business as much.

Finally, developing key relationships will boost your success (with a General Agency, for example) and provide you with a setting to have meaningful discussions and strategically talk through cases. And then, ultimately, place more cases.

Working with organizations that provide substantial training resources will help you deal with internet competition and stand out in a crowded sea of options.

“The impact technology is having on the life  insurance business is all about the experience and how everyone interacts, including the carrier, the general agency, the producer, and the client. The traditional insurance agent used to have a desk in an office. The trend now is where producers work remote, as it doesn’t matter where he or she works because clients no longer expect them to have large offices. Meetings can take place anywhere. The key is to have the tools to properly manage the business and go see clients when and where needed. The consumer experience is “all in one.“ The consumer seeks knowledge, gets questions answered in real time, and the producer needs to learn to strike when it’s hot. Instant gratification is good when it comes to the speed of getting information and consumer behavior has changed and demands this. Producers also need a general agent who can see the entire market and has strategy and tactics to find the right solutions.” -Jim Duff, President, Tellus Brokerage Connections

The Takeaway

To survive and be relevant beyond one, three or five years in the life insurance business, producers have to be engaged, recognize that the industry has changed and will continue to change, and make education and training a priority.

That’s how you can begin to ride the wave of technology disruption in the life insurance industry.
Dude, are you ready to ride some epic waves?


Dave Donchey is president and CEO of LWT Agency. A third-generation insurance agent, Dave spent 10 years in life insurance and long-term care insurance personal production and subsequently joined LWT in 1996 as a brokerage manager. He’s published numerous articles and has served as a member of several insurance industry field advisory councils. Dave handles the firm’s marketing efforts and is also a Life Sales brokerage manager. You can reach him at 626-304-1300 ext 111, email him at or follow him on Linkedin or YouTube.