|After creating my series of four posts on Primerica, I received several email from readers asking for more details. Again, I will try to make the most honest conclusions on the topic without trying to bash anyone. I use rational arguments and strongly suggest Primerica Agents to comment on this blog. I know people working for several financial institutions as well as insurance and investment companies. I will not make direct comparisons with other companies as most of them work with similar business models. What really differs from one to another is their culture because financial products are alike across the industry in Canada.|
Does Primerica have a commercial advantage?
According to their sales pitch, they do. If I sit down and I listen blindly to what they have to tell me, they will explain that they are not there for the money (but will later brag that they are making 6 figures by working minimal hours a week) since they really care about people. They want to help out people with their debt and bring them to a better financial position. They pretend that you only need term insurance and that the rest of the products are useless. Therefore, they don’t sell any other options or so they say, (because I heard they have them too).
The truth is that if you sit down with an advisor from another company, they will more likely tell you that they place the client in the center of their business. Their goal is to meet their client’s needs. Well duh, have you ever heard somebody saying that his main goal is to sell a low cost product at the highest price no matter what the client wants? Seriously! All that to say: any personal finance company will consider their clients as the core of their business. It is crucial to build a network to survive in this world. Primerica says they are there to help, some proclaim that they are providing clients with professional help; others will explain that their goal is to keep their clients as happy as a pig in s?!^.
In fact, Primerica does not have a commercial advantage compared to other companies. The truth is that if a client Googles Primerica compared to most companies prior to the meeting, the Primerica agent will have a hard time selling anything!
Can you build your own business within a company other than Primerica?
Primerica is advertising the “build your own business” model. It is up to each agent to create their own office and run their own business with their own employees and their own clients. Most companies in the personal financial field do not offer this “opportunity”. If you want to manage employees, you can become a “team leader” or a “director”. These positions are still commission based but since you are also a recruiter for the firm, they will pay you a commission on your team’s sales in addition to your own. You also have the possibility to go higher up in the company and become a regular salary-based employee.
In fact, Primerica is more or less supporting the same system. The office that you “own” is rented and displays the Primerica banner. “Your employees” are self employed / commission-based employees that are totally independent. Finally, “your clients” belong to Primerica. In their contract, it is clearly stated that if you leave Primerica, you are leaving your clients with Primerica as well. Hmmm, sounds to me more like a franchise than anything else.
What is so different in their commission structure?
If you want to meet with clients, write financial plans and close deals, Primerica is definitely not for you. You do not really have to write financial plans since everything is populated from the Primerica system. And when you close deals, you are making less money than you would with any other company. Commission rates are very low since you have three other people above you that will eat a part of the cake you just baked. These individuals have to be compensated from somewhere. Guess what, Primerica is not giving a penny to them, you are financing their “team leader”, “regional director” and “VP” positions.
So, unless you want to become a full-time recruiter, the commission structure is much better with other companies. And if you recruit people, you have to convince them to sell with under-paid commissions. Sounds like a real challenge, doesn’t it?
Please share your comments, and once again, I encourage Primerica advisors to explain what I am missing about the system.