In the January issue of NU, I reported that commissions paid to agents and brokers were increasing, reflecting an improving outlook for the industry. Carriers collectively doled out a combined $34.5 billion to agents and brokers in 2012, a significant 5.9 percent jump from the $32.5 billion paid in 2011.
Are life insurance and financial professionals who also make money from fees charged for investment advice and other financial planning enjoying a comparable increase in income? The question is timely, in part because many insurance professionals who are thinking about shifting to a fee-based practice are having second thoughts.
All well and good. Yet the question remains: How can independent insurance and financial service professionals — competing for business not only among themselves but also against alternative distribution channels —capture enough in investable assets to make a fee-based practice worthwhile?