It’s inevitable. You updated your resume on one of those popular job boards (Careerbuilder, Monster) and your e-mail inbox becomes inundated with solicitations from desperate insurance companies and financial services firms. One of the most popular or persistent of the bunch is AFLAC.
AFLAC is an insurance company that markets its indemnity products (Disability, Accident, Hospital Confinement, etc.) to businesses supposedly as an add-on to the Group Benefits (Health Insurance) it already has with its major medical provider.
Sure, AFLAC has been listed as one of Fortune’s “100 Best Companies to Work For” and has been noted on the merit of hiring diversity candidates, but let’s go beyond the mere marketing of AFLAC and find out what that means to you since you may be considering attending an interview or working toward attaining your Accident/Health License.
If you are at this point in your relationship with AFLAC, I recommend you read this first! Before you take another step!
In any discussion with a representative from AFLAC (and that could be from the greenest agent to the most seasoned District Sales Coordinator), talks of salary or benefits are NEVER mentioned until you arrive for the first interview. [The new Agent is merely given a stack of numbers/resumes to call and a script. He is coached on avoiding questions about salaries & benefits. That new Agent who called you, does not have a background in HR, nor does he know that much about Aflac.]
Calling it an interview would be quite an embellishment. It’s simply a group event (about 5-15 people) where one sits with other invitees and a Regional or District Sales manager “markets and sells” the opportunity to work with AFLAC, talking incessantly for an hour. Think of a fisherman casting a big net; hopefully there’s something worth keeping, otherwise it all gets thrown back. You will be attending these meetings with people who barely graduated high school, to fast food/retail people, to blue collar workers, to MBA’s, to new college graduates, to experienced insurance professionals. There’s no consistency here. Very little information was given out prior to the interview. But, that’s the intention.
The reality is you have to be truly be undesirable for AFLAC not to to have some level of interest. They contract anybody and everybody who can pass a background check and get their accident/health license! Why? Because there are no costs attached to bringing you onboard. No compensation for training, no hourly wage, no annual salary, no benefits, and ZERO expenses on their end. Even if you are completely unproductive results-wise during your tenure, there are no training or organizational losses on the AFLAC end — just the time and money you wasted as senior management preyed upon you as an unknowing job-seeker.
What They Don’t Tell You
Licensing — In most states, an accident/health license plus life insurance license will cost you upwards of $250 to $300… or more! You assume full financial responsibility for this expense. In addition, your costs will skyrocket if you are in a state that requires mandatory classroom training prior to being eligible to take the state exam.
Some of this expense includes an online component that AFLAC provides to assist you during the time you are preparing to study for your state exam. Yes! You will be tested! And to be honest, the test is NOT EASY despite what some AFLAC agent has told you. The greater majority of candidates who take the test FAIL their first time. While being a win-win for the company that administers the test and takes more fees each time you take (and fail) the exam, it becomes a challenge to the Aflac rep who recruited you because he has to keep you engaged and motivated to repeat the studying and test process! Remember, that’s his job!
Training — There simply is none. It does not exist. You are working with Aflac’s field staff, not corporate employees. The corporate part of Aflac begins and ends in Columbus, GA. Your team is made up of independent, self-employed, 1099′ers with very minimal oversight.
You will only be trained based on the potential sales activity you create. Why? Because your AFLAC sales coordinator will take a portion of your commission (often 50%) to take you out in the field and demonstrate to you how to close a decision-maker/business owner, how to present AFLAC to his/her employees, and how to enroll each employee. Remember, no appointments means no training! A savvy sales manager will allow you to come to one employee presentation before you are licensed (meaning: since you are not licensed, you will not share any commission for your attendance) to pique your interest, but after that, forget it. If your sales manager has any appointments either on his own or with a member of his team, you will never be asked to attend. It will generally take about 3-4 appointments before you are ready to go out on your own. The sales coordinator makes 50% of the commission of YOUR appointments and nothing when you come to his. So why would he ever train you on his assets? It would be like training you for free!
So again, no appointments, no training! And while AFLAC has online training and there is a lot of literature, 95% of what needs to be learned and is important to you, is done in the field. Because of that, keeping you dependent on them as long as possible is ideal!
The Market — Aflac’s best years are behind them and they know it. While AFLAC continues to spend millions on advertising and recruiting, many business owners are still unsure where we fit into their business. While AFLAC enjoyed somewhat of a monopoly in the business-to-business marketing sector of employee benefits and insurance in the late ’90s and early ’00s, times have changed. They are starting to lose market share.
Many insurance companies that offer property and casualty insurance or primary group medical utilized their existing contacts to enter the space that Aflac operates in. Since they already possessed established, ongoing relationships, they could leverage this to cross-market the same products Aflac does. These are seasoned, respected insurance people with years of competency, experience, and a vast network, not some bumbling, clumsy, new Aflac agent that an organization has no prior relationship with. As an Aflac agent, you will always be the fast-talking salesperson, not a respected career insurance professional. When they have questions, they will call their broker, not you. Their broker will often tell their client to stay clear of Aflac. (For those that may be unclear of what an insurance broker is, he advises and negotiates insurance on behalf of the business for compensation.)
Reputation — Since the retention for Aflac agents is about 2% – 5% in various parts of the country, there is a constant revolving door of people who come in and realize the majority of their job is cold-calling businesses. For some, the idea of cold-calling brings terror into their hearts and minds and will have them running for the hills at the first sight of a phone and calling script. Others will call, but soon grow tired of the rejection and rudeness of receptionists, office managers, HR personnel and even the owner. Why? Because dozens of Aflac people have been calling and showing up at their door for years… and it’s never the same Aflac rep, it’s always a new one like you. And to be honest, businesses are getting tired of the harassment, unprofessionalism, and turnover. Basically, you are walking into a trap and the pickin’s are slim, very slim!
An Aflac agent is not some entrusted strategic business partner in the community working to enhance the benefit packages of small businesses, they are often new agents who know very little about the industry… and by the time a business begins to have questions or claims, that agent has long left Aflac and took another job. So, who gets to manage the account? If the company does not elect to use another carrier, often the account will go to… (see below)
The Aflac District Sales Coordinator
At Aflac, it is more profitable to the District Sales Coordinator that you fail. I repeat it is more profitable to the District Sales Coordinator that you fail. Why? Because the system is set up to pounce on your assets when you fail… and leave. Think about it. Would you rather have a small percentage… or the “whole enchilada”?! Working in the industry is a lot easier when money is handed to you on a silver platter!
The majority of accounts that are personally held by a DSC are often acquired through attrition than by his own efforts. So, that nagging feeling you got when they rush you into calling and setting appointments (with the contacts you walked through the door with -family, friends, people you do business with, etc. — a.k.a. your warm market) , there’s a reason you felt like you were being taken advantage of.
Since you are new, your “warm market” wants you to be successful and this is typically your immediate opportunity when you start prospecting to make fast money. The DSC knows that he will not only get a chunk of your commission in training, but also will acquire your assets (accounts) when you finally realize you are wasting your time and move on to something else. And we’re not talking years, we’re talking a few weeks, sometimes days!! For many agents, it’s not that they didn’t appreciate the opportunity, it’s the lack of income that drives them away!
Ultimately, the real opportunity for the management team is having an efficient process that draws all the value possible from new agents (the general public) as soon as possible since the turnover rate is high and the window of opportunity is short. Once you hit a rough patch though, my, how things change! You have outlived your usefulness and there is a rush to cancel your Aflac contract and convert your accounts over. You will be tagged as an example of someone who “didn’t work hard enough”. Have you ever heard of “churn ‘em and burn ‘em?”
Even if you are lucky enough to get an appointment with a business, 90% of them are still very skeptical of working with you… and will want to shelter their employees from you. Employees of these businesses will often treat you very hostile or state they want to “wait” to enroll. Your commission check is generally only about 35% or less (upfront + ongoing residuals) of the total premium. If you are not enrolling large accounts, you will not survive.
When you do sign up a few of the employees, between turnover (meaning employees who left the company — usually about 20% of the staff in most years) and the fickle nature of maintaining added benefits, cancellations are high. Often businesses stop paying their bill for whatever reason and all the policies are null and void.
Since the compensation with Aflac means you are paid in advance (Aflac assumes that the policy will be in force for at least 1 year), you have to pay that money back (chargebacks) from future commission paid to you by Aflac. This is becoming more and more frequent.
Aflac states that “you can retire from this business in 10 years with 6 figure residual income for the rest of your life.” Due to the poor level of service Aflac provides to accounts (since it the emphasis is always sales-driven), turnover, and the constant churning of insurance carriers, this is nearly impossible these days. Many retired Aflac agents were hammered when the recession hit in 2007.
It’s a shame that a company would siphon value out of a soft job market for their own benefit. Don’t you think? Do yourself a favor, politely tell them no… make them accountable for achieving their sales targets on their own, without your help. Your business contacts and associates are precious. Don’t pawn them off to anybody. It’s not worth it.
While the idea of running your own business and being independent of corporate trappings is appealing in theory, in practice the greater majority of new agents will fail. Enrollment opportunities are few and far between. You’ll be poor, hungry, and homeless before you see any real reward for the hard work or sacrifice. That’s if you reap anything at all.
I’m sure you had higher expectations for your career, if you truly give a “quack”, better to “duck” that call or e-mail!
Tell us about your experience with Aflac in the comments section below!