Colonial Life Offer

[hill country]

Good Afternoon Everyone-

As a long time lurker and occasional poster, I have a few questions. I have been interviewing with a handfull of carriers and recieved an offer from Colonial here in Texas. I became aware of them several years ago when I was managing a small business and brought them in to fulfill requests from employees for workplace coverage. Now, I am contemplating joining them. I searched the forums and found some balanced information regarding them. What are some current thoughts on them? As a client I never had any issues with them but I am curious what they are like to work for. This is a big career change for me that I am not taking lightly so I am doing my homework! I am used to working 50-60+ hours per week so I don't have any issue jumping in with both feet. I was fortunate that my severance agreement should provide a little cushion for a few months while getting started. I just wanted to come on here and ask the pros before I say yes! Thanks in advance!

 

[Labman]

I'll tell you that getting started will NOT be easy nor will success come over night. You will have to cold call and prospect your ass off to make it. I've been with Colonial from an employer standpoint and a sales standpoint. They are a great company but YOU have to do the work to be successful. I'd focus not only on finding businesses that don't offer benefits, but those whom have AFLAC. Replacing AFLAC should not be that hard. Bottom line, you have to be disciplined, able to tolerate a lot of rejection and willing to hang in during tough times. Focus on learning not only the product but sales techniques as well.

 

[Guest]

I sold Colonial for about 18 months, but not full-time.

Colonial has several major problems:

1. Their comp structure is too low for the work involved. All of the comp they promise you is in the way bonuses and good luck reaching those levels in this economic environment. The only way to make good money is to not only open the account but to also enroll it. However, these are two different skill sets and knowledge bases and it takes a lot of time and effort to learn and do both.

2. Management is weak and home-office centered. Basically there are just too many levels of management all getting a piece of your action such that there is little left for you... which is why their comp structure is so low.

3. They have terrible, horrible, and almost non-existent marketing. Yet they compete against a huge and highly talented marketing team with AFLAC. "Colonial who? Oh you mean Colonial Penn?" That's what you are going to hear.

4. They have inconsistent (non-existent) commission split policies. Your immediate manager can decide that you must split your commission with whomever he chooses, and you can't do anything about it. That's what happened to me... and why I walked away from the company when he gave 50% of my commish to another agent who did about 5% of the work.

5. They market the sector with 20+ employees. But there are lots of 4+ employee companies out there but Colonial has a minimum premium level that must be met... and that takes about 15 or more with good participation (which is usually about 65% with an average monthly per-employee premium of $60.) They don't have a good or easy system for you to sell to individuals. They are married to payroll-deduct... so forget about selling to beauty salons (indie contractors) which AFLAC can do easily.

6. Colonial is less of a churn and burn shop than AFLC, but it is still a part of the paradigm. Your manager will want you to stay and produce but if you don't, it's no big deal as he will get the account sooner or later because you won't be highly vested if you don't stay for a while.

7. You do not own the clients... and you will sign a contract prohibiting you from contacting them and moving them to a different company when you leave Colonial.

8. The worksite sector has been clobbered in many sectors of the economy. The boss will tell you when you call "Don't talk to me about benefits as we're trying to figure out how many we have to lay off next month."

9. Colonial will want you to sell some rather complex products that are simply not suitable to be sold in the 15 to 20 minutes you will get with each worker... and the boss probably won't allow much more time than that.

10. Compared to what clients can get in the non-group market, Colonial (and AFLAC) are overpriced. For term life, for example, true Colonial has simplified UW, but the client pays for it out the a$$. Most employees would be much better served by buying term from a non-worksite carrier with full UW and you the agent would make more than the 22% to 27% that Colonial pays on that product.

Colonial has two great things going for it:

1. They offer terrific training in most locations and I give them credit for doing a good job trying to get agents in the field who are knowledgeable about the products.

2. They are honest and have a "team" culture. You will like most of the people you meet and they will do their best to help and assist you.

Given the risk to reward ratio I would not advise anyone to start out in the worksite sector with the idea of making anything put a part-time, sideline income. The economy is wrong, the comp structure is not there, and products are not as cost-effective for many clients as those offered by agents on an individual, non-payroll basis.

You success or failure will greatly depend on your manager, how committed he/she is to training you and being fair with your comp. And your success will depend on your local economy, what the employment picture there is, and how entrenched AFLAC is. Everyone loves the duck... and why not? The clients don't know the "inside" story of AFLAC... all they see are the clever commercials how the CEO does not take a huge salary and all the good press the company gets.

Good luck. You will need it.

 

[hill country]

Labman, Al, Thank you for the honest responses and giving me a realistic view. Our economy here is doing a little better than other parts of the country as this is a big tecnology, medical and military area. That being said, it's not quite as good as it was 2 years ago. When you two were with Colonial what level were ya'll at? They are so slim down here that they are telling me I could start as an ADM if I chose. Should that be a red flag?

 

[Guest]

They are so slim down here that they are telling me I could start as an ADM if I chose. Should that be a red flag?

As I remember an ADM just gives you a slightly higher comp but maybe it also allows you to recruit other agents and get an override. I forget.

It is a level most often granted to someone who has been with the company for a while so either they think you have terrific potential or they don't have anyone to promote... meaning biz is bad and agents are not staying with the program.

It's been a couple of years since I've had any contract with Colonial so maybe their org chart has changed.

The best way to work with Colonial is to use them as a sideline. If you sell, say health coverage, to a group, bring in a Colonial agent, let them do all the work and you can get a 50% (give or take) split. It is "found money" and this is actually the proposed method of finding clients that Colonial used to teach... to team up with another broker who already has a book of group biz. And that is another reason why the comp is low. Splitting an already low comp with another broker as well as all the overrides that your manager gets, the enroller gets, the co-ordinator gets, and the regional manager gets, as well as the guy who recruited you get (yeah he gets a point or two)... at the end of the day Colonial gets the gold mine... and you get the shaft.

Good luck with it. Personally I think there are easier and better ways to get into this biz, but as I said earlier the training is (or can be) very good, the people are nice, the company is honest, and they have a "family-team" culture... which might be appealing to you vs. being a "long-ranger" agent out there all on your lonesome.

Before your join Colonial, talk with AFLAC. Don't listen to all the crap here about them. They have some good managers here and there and used to have a better comp program than Colonial. But they have their downsides too... a lot of them... but if they are "stable" in your area you will find it is easier to open a door as everyone has heard of them... and "likes" them, where as no one has heard or knows of Colonial.

I think it is difficult to make a sustainable living with both and encourage you to seek other avenues of entry into the biz... but every person and every location is different with these two companies so you have to do your research and sometimes just trust your gut.

Al
InsuranceSolutions123 Agency

 

[Benefits Man]

Hill/Labman, I just submitted a new thread in the insurance offers forum and it is waiting for approval. Basically, it is a no strings attached (no noncompete/no production requirement) GA level contract offer for Texas agents. Or PM me for more details.