Safeco Corp. of Seattle, Wash. has renamed itself Safeco Life & Investments to reflect the combining of its 25 insurance and investments salespeople into one team selling both insurance and investment products, including mutual funds, annuities and variable universal life. Only property and casualty insurance will continue to be sold by a separate sales force.
"We were stumbling over ourselves in the field and now we have a concentrated strategy to call on our bank, RIA, broker/dealer and institutional distribution channels," said Steve Manuel, manager of Safeco's combined distribution channels. The name change and the combining of sales forces took effect in June.
Salespeople who had sold mutual funds are now learning how to sell annuities and life insurance, and vice versa, Manuel said. To avoid duplication of assignments, Safeco has reassigned all of its salespeople in 11 geographic territories, he said. No jobs have been eliminated as a result of the realignment, he said.
Across-the-board offerings of investment, banking and insurance products are "increasingly taking place, reflective of the convergence in the financial services business," said Dennis Dolego, director of research for Optima Group of Fairfield, Conn., a mutual fund distribution consulting company. "People are selling outside their core competencies." Insurance companies are increasingly training their salespeople to also sell mutual funds. (MFMN, 4/5/99)
Safeco's reorganization has met with some resistance, Manuel said. Some wholesalers who had longstanding relationships with major distributors and who have been reassigned to new territories were unhappy with the reorganization, he said.
Safeco has tried to overcome these initial hurdles by having pre-existing salespeople assist newly-assigned salespeople on their calls, Manuel said. This provides the new salespeople on-the-job training from a practiced expert, Manuel said. This training, which Manuel calls "shadow-mentoring," is the only special training the sales force will receive to adapt to the reorganization. Side-by-side calls also allow the pre-existing salesperson to gradually become less dependent on their previous commissions, he said. Commissions for sales made on the dual calls are shared.
"I came out of the field, so I am very sensitive to reassignments," said Manuel. "The way we structured the new territories, we thought was equitable."
The reassignments make sense because Safeco's investments and insurance salespeople had been selling against one another, Manuel said. Having one person selling all products is easier for customers, should strengthen relationships and, ultimately, lead to larger sales, he said.
The new marketing strategy "should make us more competitive [and] . . . efficient," said Victoria Martinsen, a Safeco spokesperson.
Safeco's previous organizational structure had duplicate marketing, product development and distribution departments on the investment and insurance sides of the business.
However, the more complicated products, particularly annuities, could bring a "level of complexity" to a sales pitch that could "confuse customers," Dolego said.
"They'll need to integrate their products in a way that makes the sale simple enough," he said.