November 5, 2009, 5:43 pm


by: The Financial Blogger    Category: Primerica Series
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My friend just called me to let me know that Primerica is finally going public! After several unsuccessful attempts to sell Primerica, Citigroup found no other choice but to offer the first Primerica IPO. In fact, Citigroup is expecting to get as much as $100 million.


I don’t have time to write more about Primerica IPO right now, but I’ll come back with more thoughts on it later on… Let’s just say this could mean significant changes in many Primerica agents’ business models…

While you can read the full story over at Bloomberg, I was more concerned about each individual’s business model.

As I have mentioned in my Primerica Reviews, Primerica’s business model is based on recruiting. The real way of making money through Primerica is to build a sales force who sells insurance products to their relatives. We may debate if their term insurance products are good or not, this is not the point of the post. My main question is, will Primerica’s business model be threatened by this IPO?

Primerica IPO impacts


When you read Primerica’s contract, it clearly stated that clients of Primerica remain under the control of Primerica if the agent was ever leave the company. So, what if a major insurance company buys Primerica shares to take over control of it?

Some say that it will take over a huge sales force (more than 100,000 Primerica agents). Others, the evilest of us, may think about buying one of the biggest client databases in term of insurance products.

This would mean that the so called “business” Primerica agents built could change hands within a few years (and a lot of millions invested in stock ). I am not saying it will happen overnight, but it is surely a sign that nothing can be taken for granted.

The potential new owner could also decide to cut the pyramidal aspect (commission wise) and name Regional Directors and VPs and pay them as salaried employees (this would cut their pay checks drastically and significantly increase Primerica’s profit… which is always good for shareholders!).

And what could Primerica agents in the face of an IPO?


Not much unless they have $100M to spend on the shares! While $100M will provide new cash to Citigroup and won’t really affect Primerica’s upper management, it still opens a breech. This breech will force Primerica to open its books and show how interesting (or uninteresting) the company could be for a potential bidder (hostile or not).

Then again, another point is the following: Do you feel safe building a business that is not yours? You can’t really call it a team since they are not your agents and they don’t sell to your clients… I am wondering…what about you?

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by: Michael Thomas | October 15th, 2011 (5:31 pm)

@Super Scar

Background: I am in the U.S. as well. I was in Primerica for 16 years and a Branch Manager (RVP) for eight, and I have owner four Primerica Life policies over the years. I now havew an independent financial services firm and we frequently replace PFS policies.

The rates between PLIC and other firms are not close. When comparing term policies it’s important to keep the rating classes in mind. PFS is VERY strict in rating thier clients. So, a client may get a “preferred” rating with PFS, but a “super preferred” with ING, for example.

Here is a spreadsheet of recent Primerica policies we’ve replaced:


-68 replacements (issued policies, not just sample rate quotes)
-Average $76,342 increase in coverage
-Average 6 years added of guaranteed covered length

What “extras” are you referring to in your Primerica policy?

The only extra I know of that is uncommon (but not exclusive to Prmerica) is the “Increasing Benefit Rider”, which I consider a gimmick. Just get the proper coverage from day-one.

All child riders cost money, and Primerica’s cost’s more than average, $6.50 per $1,000. Most are $5. So, I have no idea what you mean that your friend paid extra for his child rider. Of course, he did, and so do you on your PFS policy.

Summary, you can always do better in the open, independent, term market than with a captive company, such as Primerica (or Farmers or State Farm).

Super Scar,

Do you own your own home or rent?

If you rent (say like term life insurance) why pay more for less? a
In Canada, you pay the highest rates rates if you are a female. If you are a male the “rent” is high as well (Primerica). You also have less benefits like the choice of converting term to permanent.

My understanding is most Americans like freedom and choice. Also if they can pay less and get more, even better…just like Canada. Why stick to one company?

by: Super Scar | October 16th, 2011 (8:23 am)

Brian, the reason is because I’ve already been sold the wrong life insurance before. I was never educated about it until Primerica. And, my Primerica person has really helped me in many areas, not just life insurance. Also, the companies you listed in your previous post – sell whole life/universal life which is just plain bad for the consumer. I won’t do business with them, term or otherwise, now.

I’m willing to bet they try to sell whole life to everyone. My Primerica person helped a couple of my friends and showed how their agent could have sold them term but didn’t. (and I know all about how difficult it is to collect on disability insurance, I know someone who had to go to court)

I don’t think it’s a coincidence those companies are cheaper, either. In 2009, when Primerica’s rating stayed A+, Equitable and Transamerica’s ratings were downgraded to BB+ and ManuLife was given a negative outlook. I’d like to be sure I’m with a company that will be in business when I need them. (I never knew about looking up ratings either, before Primerica — I feel much better educated now, and I owe that to them.)

Super Scar,

You forgot Royal Bank of Canada, Bank of Montreal, Sun Life, Desjardins, Standard Life, Great West Life and many more.

Here is what is looks like:

Female non smoker term 20 $500,000 age 41 ( June 15, 1970)

RBC $42.84/month
Canada life $45.90/month
Bank of Montreal $46.90/month


Primerica $89.78/month

Since our insurance companies are well funded (like our banks) and is regulated by the government all insurance claims have been paid for over 100 years here in Canada.

Does Primercia offer disability insurance ?

by: Answer This | October 16th, 2011 (2:36 pm)

Super Scar if you found our Primerica does business with carriers that also sell permanent products would that be an issue?

@ Answer this,

I think now we know now Super Scar (is a Primerica rep trying to pretend he is a customer) knows a lot about taxes and uses a macroeconomic model to to determine that Primerica is the best value …yes they charge double, for females, (he does not have a mother or a sister or knows any females), but who cares?!

by: Super Scar | October 16th, 2011 (6:58 pm)

First, you aren’t far off, I have worked for investment banks since the 80s so I know how to get information when I need to. You don’t have to use a macroeconomic model to know that insurance companies were in ratings hell in 2009.

Btw, Primerica purchased Smith Barney when I was there. I was in SB’s research division, though. I found this post because I just went to an open house at a Primerica office and decided to google the company. (The RVP suggested I google “which company has the most six-figure earners”)

I know a lot about investing but not enough about insurance — for example, I thought everyone made women pay more until your post. Also, I never do my own taxes. I just have had my share of insurance people and investment advisors come to my office to see me and then, before they even ask me anything, try to sell me disability insurance! When did this start being the norm? It’s crazy — I’ve never seen anyone collect disability without going to court or being followed by a detective. It’s enough to make a person hate the business altogether. I resolved to never talk to those people again. I know someone who wanted to invest $100k with an advisor and the first thing they tried to do was sell him disability. I told him to read “One Up on Wall Street” and do it himself. I just don’t understand when this mindset took over…

@Answer this, I know Primerica does business with other companies, some of whom I like and some I don’t. Is that what you mean? I don’t know who they do life with, though. All I know is, they didn’t try to sell me universal life or disability! 😉

For those following this thread I would like to clairfy this statement by Super Scar

“The RVP suggested I google “which company has the most six-figure earners”)”

In raw numbers they have a high number… about 2,500. But, they have 100,000 licensed agents and they recruit 20,000+ per MONTH. So, percentage-wise they have a very poor track record in getting Reps to earn money.

Also, those 2,500 Reps are those that have earned $100k at ANY point in their career, which doesn’t mean they are earning that currently. Primerica won’t publish that statistic.

By their own admission the average Primerican earns around $6,000 a YEAR.

By way of example, in my Agency 48% of Active Reps earn $50k and 22% earn $100k. And, we also don’t have quotas and allow part-timers, so these are pretty good ratios, I believe.

by: Answer This | October 17th, 2011 (1:47 pm)

The reason PFS won’t push UL is because they don’t currently offer it. There are carriers who offer a TermUL or a Guaranteed UL where cash values are not a main consideration. Yet I’m sure for some those products can be debated.

Primerica works within a specific target market range so many agents just may not see the needs of people at older ages or if a person did not take the BTID concept to it’s full term. So as much as people may bash CV products currently there is a good size market for term conversions, Final expense or just people still having a need for coverage after the retirement years.

As for disability as there have been some issues within that line of product I have seen some people who it has benefited. The same with critical illness, terminal illness riders and chronic illness riders along with other benefits and riders.

Now for when considering the agents who may earn over $100,000 I go by what I once heard on a old ALW tapes. He said it really doesn’t matter what anyone else earns because it’s not like anyone is going to give you any of their money. You just want to make sure you have the opportunity to earn what you want or need. .It’s kind of funny the RVP would tell anyone to Google $100K earners because an independent agent has more opportunity than a captive. Then again it may just be that the RVP may not know any better

This is my opinion only. I just think for the person who has no desire to recruit it is much harder to earn from personal production at PFS rather than at other places. The same holds true for those who may wish to build an organization but most people just don’t look at the bug picture from a business perspective rather than an emotional one.

In the big picture it all comes down to you do you.. These battles have been going on for years and it’s said PFS is down to about 90K licensed agents and is supposedly having problems getting people licensed to the point they wanted to get the DOI’s to make the testing easier..’s been over two years since this thread started. No buyouts by any other company and PRI was rated the #1 IPO for 2010. All this jibber jabber about earnings. The company is built on part-time reps and thrives on part-time reps who earn $500 – $1000 monthly or so for a few hrs of business a month. I’ve just started in this business and avg about $300 hr for my efforts. Already have over 100K in managed IRA / investments which will pay monthly for years to come. This business makes me all my vacation money, plus love those override$ from the other reps I’ve trained. $50, $100, even $725 once that just shows up in my account when one of them does business. If this is a scam….I’ll take two.


“’s been over two years since this thread started. No buyouts by any other company and PRI was rated the #1 IPO for 2010. ”

I wouldn’t position the IPO as a benefit of PFS if I was in Primerica. It was/is a disaster.

1) It was two years ago, and is completely off the radar now.

2) PFS got all the downsides of the an IPO (public scrutiny and pressure to perform quarterly, which is ad odds with “doing the right thing” for Reps); and none of the benefit (cash – it went to Citigroup, not PFS). PFS’s IPO was a “spin-off” IPO not a “raising money” IPO.

3) No have “buyouts” by any other company, as Theubers stated, demonstrates no one wants this company – I wouldn’t brag about that. Remember, Citigroup has PFS in it’s “toxic asset” group (true name) for two years looking for a buyer. They all backed-out, including Flower Insurance. Finally, they shedded them in a spin-off IPO.

“The company is built on part-time reps and thrives on part-time reps who earn $500 – $1000 monthly or so for a few hrs of business a month.”

Really?!? According to Primerica’s FNA, the average reps earns $6,000 PER YEAR, and that included the 60+ million-dollar earns (if you subtract the $100 million in commissions that goes to them, the average drops down to $5,0000 YEAR.)

Try disclosing that at the beginning of every recruiting interview and see how many people join.

“I’ve just started in this business and avg about $300 hr for my efforts.”

I’d like to see the math on that. Are you including prospecting time, driving time, plan-design time, follow-up time? To be fair to salary employees who get paid per hour you need to be honest about this.

“Already have over 100K in managed IRA / investments which will pay monthly for years to come. ”

1) If you are below Regional Leader you get NOT trails on this business ever.

2) Even an RVP would make less than $1,000 per year in trails on a $100,000.

3) $100k under management is nothing to brag about. Unless, it was was misprint. We just hired a Primerica who originally came from Morgan Stanely with $10 million under management. He went to PFS and lasted less 3 months, before going Independent with us. The reaons? No trails for his AUM and even at RVP the commissions stink.

” This business makes me all my vacation money. $50, $100, even $725 once that just shows up in my account when one of them does business.”

Do you consider this good money for being in financial services? Really?

-Michael T.
Former Primerica RVP
Helping Primericans go Independent since 2006.