As the structured settlement profession starts it's annual year end rush for business I'll be curious to see if we can close the gap in production in what has been a horrible year for the vast majority of brokers. As I related in an earlier post, most brokers and industry insiders estimate that the profession is off anywhere from 25% to 35% from 2009 compared to 2008, with various culprits jumping up to lay claim as to the cause of this decline:
1. The impact of American General and Hartford being down graded to A ratings by AM Best was more profound then anyone anticipated.
2. The loss of Aviva which was building the industries most innovative and aggressive sales team pulled a lot of energy, and premium, out of the markets. Sales are not a "zero sum" game where you just shift premium around. Innovative and smart sales support groups at life markets can make a big difference in developing and supporting sales efforts so cases get closed.
3. The retreat of Allstate and Prudential in non-qualified markets, alternately reducing capacity and closing down Prudential's offshore assignment operation, not only cut premium but killed momentum and growth in those innovative markets.
4. A plunge in interest rates making yields on structured settlement annuities drop to a level where most people are reluctant to go long term at very low yields.
5. A desperate need by plaintiffs to reduce debt and pay off bills eliminating funds that would previously be allocated to structures.
Hopefully the last 8 weeks will carry the profession to a strong finish and most conversations I am having seem to point in the direction of our typical year end bump. However, whether or not it gets us out of a deep hole is another matter and the raises the question of the ability of the profession to kick start sales in 2010.
Does the structured settlement profession have the salesmanship and marketing skill necessary to restart sales growth, or are we witnessing a slow steady decline in production levels? As I've opined before, unless or until our profession restarts the non-qualified market and more fully embraces settlement planning as a legitimate process, we are going to see ongoing deterioration in our production numbers as a profession. While many will prosper in the coming years, can our profession survive in a climate of continued shrinkage in premium growth?
Any estimates from my readers as to how the premium numbers finish up for the year?