Getting Together: Inter-Company Marketing Group Finds Interest, Activity in Insurance Strategic Alliances
Jan 11, 2012
Two-thirds of life, health and benefits insurance market participants have added revenue to their firms in the past three years by engaging in strategic alliances.
That finding, from an industry sample taken by the Inter-Company Marketing Group (ICMG), is a sign that working together with quality business partners is a source of added customers, revenue and profits.
ICMG’s strategic alliances survey, conducted in October 2010, showed that of nearly 70 survey participants, 68 percent said that strategic alliances had added to their revenue. Another four percent said alliances replaced lost revenue. Strategic alliances are defined as partnerships, product distribution agreements, private-label products, third-party administration agreements, joint ventures, and other multiple-company efforts that generate revenue.
ICMG is an industry organization that is in its third decade of serving as a catalyst for insurance business partners to network to explore potential strategic alliances.
The survey also found that nearly 9 of 10 stated that strategic alliances will become more important over the next three years. Respondents expect to be involved in strategic alliances in multiple insurance product lines.
The respondents are executives and professionals involved in the development, distribution or manufacturing of life, health, and benefits insurance products. A range of companies is represented in the survey, including carriers, distributors, third-party administrators, and other related companies.
ICMG is the leading association devoted to fostering strategic alliances in the insurance and financial services marketplace.
Respondents also pointed to strategic alliances as representing a significant part of revenue. Of those participating in strategic alliances, 35 percent said strategic alliances generate more than 30 percent of their company’s or business unit’s revenue.
Many in the industry intuitively know that strategic alliances are vitally important, and more so every year. But this ICMG survey, while a sample, indicates that insurance strategic alliances are widespread. The ICMG survey also points out that there is solid financial value in strategic alliances for the insurance market participants that engage in them.
Strategic alliances include distribution firms aligning with insurance product manufacturers, third-party administrators providing services to product manufacturers, and private-label products, among others.
Individual life insurance, group life, Medicare products, and individual dental and vision insurance were the products most cited by respondents for strategic alliances in the next three years. The top products, according to survey respondents, are:
- Individual life insurance (cited by 52% of respondents)
- Group life insurance (42%)
- Medicare products (38%)
- Individual dental and vision insurance (38%)
- Accident (36%)
- Individual medical (33%)
- Individual cancer/critical illness insurance (33%)
Going forward, respondents expect to be active in numerous other product types, including: group medical, indemnity, individual and group disability, annuities, group cancer/critical illness insurance, final expense, property and casualty insurance, individual and group long-term care, final expense and non-insurance products (e.g., discount plans). Respondents also mentioned their interest in alliances for mortgage insurance, wellness programs dental plans, travel assistance, identity theft resolution, supplemental health, retiree medical, financial wellness, employee assistance plans, and accidental death and dismemberment.
For the complete ICMG survey results, visit www.ICMG.org/survey.
Ted Williams, LLIF, is chief marketing officer and executive vice president of Security Life Insurance Company of America, Minneapolis, which manufactures dental, vision, life and disability products. Williams served as 2010-2011 president of Inter-Company Marketing Group (ICMG), a nonprofit association that fosters strategic alliances between insurance and financial services companies. Among the members of ICMG are marketing and business development decision-makers with insurance carriers, distributors, third-party administrators, and other related companies.
About the Author
Ted Williams, LLIF, chief marketing officer and executive vice president of Security Life Insurance Company of America, Minneapolis, is past president of Inter-Company Marketing Group (ICMG), which fosters networking and strategic alliances among product, marketing and business development decision-makers with insurance carriers, reinsurers, distributors, third-party administrators, and related companies.
