Episode 21 with Bruce Parker, President, Global Life Insurance at Pan-American Life Insurance Group – Leading an International Carrier Through a Pandemic

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Beyond the Challenge is a podcast where executives in the insurance and financial services industry share their insights and experiences. Hosts Kevin and Sandy Dougherty talk with today’s top business leaders about what keeps them up at night and the biggest opportunity organizations can capitalize on today. We encourage you to listen, share, and subscribe to our program.

Kevin and Sandy Dougherty each have over 20 years of experience in insurance and financial services, corporate leadership, and executive search. They’re the owners of Global Corporate Solutions and Global Corporate Leaders. Global Corporate Solutions partners with organizations to gain efficiencies and contain costs. Global Corporate Leaders partners with organizations to enhance and evaluate talent.

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Welcome to Beyond the Challenge. Here are your hosts, Kevin and Sandy.

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Kevin: Today, we’re talking with Bruce Parker, President, Global Life Business, at Pan-American Life. Bruce, can you tell us a little bit about yourself and a brief history of Pan-American Life?

Bruce: Yeah. So, Kevin, I think about my career, in January, I’ll be coming up on 40 years in the industry, one of those guys who started off as an agent, spent the early 20s, mid 20s, as a producing agent, worked my way up through the ranks of being a sales manager, an agency manager, spent time as a general agent, and then I became an executive with Prudential in 1996 or so and, at that particular point, I moved to Atlanta and I was a head of the Southern territory for Prudential at that time. And then I spent the next few years helping Prudential work their way through their demutualization and putting in a new business strategy in place. And then, in 2000, I went and I spent time at Jefferson Pilot, which is now Lincoln Financial, and I was a Chief Marketing Officer. In 2003, I took an opportunity with Old Mutual when they purchased F&G Life and I became the president of that company in 2003 and I stayed as president and then became the CEO by the end of my tenure there in 2009 and then Old Mutual subsequently sold the business and, obviously, F&G Life today is under different ownership. And, in 2009, I had a great opportunity to join José Suquet, Pan-American Life, as we were starting to redesign our strategy for the future and I joined José and our very competent team here and I’ve been here for the last 13 years building the life strategy for Pan-American Life, which is a US-based strategy and an international life strategy.

Sandy: Thanks, Bruce, and welcome to Beyond the Challenge. There are several business challenges that established insurers are facing as they try to meet new customer needs while improving their core insurance functions. Some of the main issues we’ve observed are defining short-, medium- and long-term strategies, transforming organizations to reduce operating costs and enhance customer experience, and looking at new distribution channels. Can you tell us how has COVID-19 changed the way Pan-American reaches new clients and services your existing clients?

Bruce: It’s a very good question. I think it was obviously an issue for our whole industry worldwide when the pandemic hit. How are we gonna do this? How are we going to continue to service and sell new products to the people who needed it the most at a time when they needed it the most? Like quite a few companies, we were actually in the middle of a digital transformation at the time of the pandemic. And all we tried to do is to speed that up as best we can. We’re still working on pieces of it, but we were moving quickly to electronic applications, straight-through processing of certain style pieces of our business, electronic delivery of our policies for policyholders, and ours is a complex model because it’s both US based and international based but we tried to tackle both pieces during this period of time. What we were really focused on is how could we make it easier for the agent who was at that particular point really facing insurmountable odds about how they were gonna run their business when really it’s been a face-to-face business forever and they weren’t able to see their clients. So, creating a model that was digital based, including interactive interviews with the healthcare providers and all those types of things, were an integral part of this process that we’re putting together to be able to complete the entire sales process.

Kevin: Bruce, from your perspective, how can insurance carriers embrace innovation and transformation to improve performance and drive long-term growth?

Bruce: Well, I feel you have to have a strategic plan first. Where are you trying to take the company? And what I mean by that is not just a pure sales plan, if you will, but the overall customer experience, customer defined as the end buyer, but also including that very critical agent in the middle, and then trying to figure out what’s the best way to have both of those experiences different than everybody else. And you have to be able to embrace technology. And to be able to embrace technology, you really do have to work with outside resources as well as inside resources and constantly you have to be evaluating both of those. Do you have the right people in the right seats? Did you hook your wagon to the right company for this particular piece of the process? That vigor of looking constantly at the process is really key to building the long-term strategy.

Kevin: What do you see as Pan-American’s main differentiator?

Bruce: So our main differentiator is that we are a company that really doesn’t get distracted, and let me explain what that means. We are a company that, for the 17 years that José Suquet’s been the CEO, the 13 years I’ve been here as President of Global Life Business, we have stuck to our core, which is life insurance and health insurance. We don’t sell annuities or other products, nothing wrong with any of those products, but we felt for our style of company, a real focus on life insurance and health insurance was the best way for us to build our company. Now, we sell our life, health, and accident business, the three of them, but life and health on both an individual and a group platform. Now, I’m in charge of all the life individual platforms but our business is cleanly focused there so we don’t get a lot of distractions, if you will. And by doing that, we can become an expert in those areas and then we consider ourselves a niche player in some markets, so let me explain what that means. So, in the US market, Pan-American Life, in particular, was focused on the US foreign national business, international customers that come to the US, mainly Latin American based but other individuals as well. We have a 100-year history in Latin America, a 100-year history in the US, a very strong brand name all throughout Latin America, and so it was natural for us to take that space, which was the US foreign national space. So that was one example of having a niche strategy of how we go about our place. The other thing that we’ve done is that we did a merger five years ago with Mutual Trust. Mutual Trust is a whole life company, great team there, great loyalty with the producers and with their customers, of course, but, now, we are expanding that reach across all throughout the US and then growing that business as well. So, we have a very targeted approach in the US with how we’re growing the business. And I think that’s really been the key to our success is that we find a niche or a place that we can play well and then we really focus on it. So we don’t try to be all things to all people.

Kevin: Bruce, what do you see is Pan-American’s biggest growth strategy?

Bruce: Yeah, I don’t think we have one biggest one, but let me explain our growth strategies as we are moving forward now. The first one is what I talked about earlier, which is the US foreign national business, which is what we call our Private Client Life Division, that’s the name of that division for our company. The ability to service clients in Latin America, parts of Asia, parts of the Middle East, those individuals have a need for a US-based solution to their estate planning and business planning. That’s a big growth business for our company. Another growth business for our company is our employee benefit business internationally and in the US. It’s a very critical part of the overall strategy of the company is to grow our employee benefit base. Some people might not know that in places like Panama and Costa Rica, Honduras, El Salvador, etc., we’re the number one health insurance company in many of those markets and we’ve been there for over 100 years so continuing to grow that business is very, very important to us. And it helps our company because then we have a strategy around the long tail business, the life insurance business, and the short-term business, which is the health business, the annual renewable business. So, the combination of those two are really the key drivers on where we wanna be able to take the organization. We’re also very focused on growing our US presence with Mutual Trust, that’s another big part of our business. And then continuing to grow our life businesses in pockets in Central America. We have a very strong presence in the Caribbean as well. And there, we actually drive our business on a career agency system, which a lot of us have got a lot of experience in and I grew up in that business, José Suquet grew up in that business so we understand that one very well and it’s a very good business for us.

Sandy: How do you see organizations like Google and Amazon entering the insurance space changing how the insurance marketplace works?

Bruce: Well, you know, we, especially those of us that have been in the business a long time, you’ll say this is a relationship business, it’s face to face, I don’t think that ever changes but we do have to come to terms that the consumer is changing. So, the consumer does wanna have that ease of doing business and if we do not address that question than we do open ourselves up for the Googles and those types of players to come in and take part of the market share. I think those types of organizations are always gonna be hard on the life side of our world to sell effectively on cash value products because it does take a really good financial advisor to be able to work with the client to be able to make those decisions, but commodity products like term insurance and those types of things, they might have opportunities there. And my only advice to everyone is, you know, if that’s the market that you wanna be in, then you really have to address your digital shortcomings to be able to maintain your market share.

Sandy: How is Pan-American adjusting to the low interest rate environment that we’ve had over the last number of years?

Bruce: It’s probably my number one risk as the head of the life business. As we look at the company, and, of course, we’ve had COVID-19, the claims from COVID-19, but, really, the biggest one that is the inhibitor for our companies are the ability to manage this low interest rate environment. It’s not a great environment for life insurance companies. So, how do you manage that? Well, one, you better have a really good investment department and investment strategy at your company, and I’m proud to say we have really one of the best top-tier investment groups in the industry and it’s rated every year as a top quartile group. That is very, very important so we get enough yield out of that, enough extra yield to help us. But the real way we do this now, because it is prolonged, is the way you have to design products moving forward. So you have to look at products with lower guarantees or lower the guarantee rates and make the product be able to make company profits based on things other than just the investment return. So, constantly revisiting the new products and how we design the new products moving forward and that you do have to manage the interest rates and caps on the products that you’re selling based on what your investment returns are giving you.

Kevin: Bruce, do you see carriers looking at more strategic partnerships or keeping more in house?

Bruce: I think the pace of change is so fast that people are looking more strategic than in house. There’s always gonna be an in-house piece of this but because there’s so many different moving parts and so many specialists out there, especially in the digital world, you have to have strategic partnerships. I don’t think in house, you can build your own CRMs and your own e-apps and those types of things. You need partners to help get you there. However, you also have to have an incredibly strong team yourself, however you have that set up inside your company, however your strategy is designed, the people who are making the calls to your company really have to be experts in their areas, even if they’re working with an outside person, because someone has to help keep everybody accountable and continuing to measure every time you go into a new relationship. The real work happens after relationship starts. Are they delivering? Are you getting what you want out of it? Are you making adjustments on the road? And that’s what a lot of companies get in trouble by not constantly monitoring and measuring that.

Kevin: Bruce, how do you see distribution changing over the next few years?

Bruce: Well, you know, we’ve always said that the distribution is aging and that’s true. However, there is a lot of new agencies, non-traditional style agencies, that are recruiting thousands and thousands of new people to our business and we’re seeing that grow. We’re seeing new distribution companies come around. We’re seeing private equity invest in independent distribution in the life insurance industry. And these agencies are really recruiting a lot of new blood to the industry. So, I actually looked at what’s happening in the independent space for the first time and see them bringing new producers to our industry that the career systems that are in place today. One, we don’t just have enough career systems anymore. We have some very, very good ones there but we just don’t have the volume we used to have. So, what I’m seeing is that that independent agency structure is adding more and more people to the industry and that’s very, very important. The key to those agents succeeding is the way — that never changes. You’ve gotta have an agent who can get in front of enough people on a favorable basis and have a good product to sell that covers the need of that individual. And some of these agencies have done a great job there with lead generation, selling systems, those types of things that actually are making it much easier sometimes, or maybe easy is not the right word but giving that agent a much better chance of success by some of the tools that they’re giving them. So actually I’m very encouraged with the future of the distribution of our business. Of course, it is evolving and I’m seeing some really good trends.

Sandy: What is the best decision that you made that had a positive impact on your career?

Bruce: So, for me, I always remember once, and I was an agent and I was getting ready to become a manager, so I’m going back in my mid 20s, late 20s. That’s a long time ago. But I had a great agency manager who sat down with me and he said, “Listen, this career can be anything you want it to be. If you wanna be a great agent, you could spend the rest of your career building a great agency” — no, building a great insurance practice, excuse me — “and you’ll have a great life.” He goes, “If you choose management, if you wanna run an agency, and you choose that as your career path, that can also be very, very fulfilling and it can be tremendous for you. Or if you choose to go into the home office, you can work your way up through the ranks, if that’s the way you can go.” So what he was trying to explain to me in that conversation was don’t make a quick decision to leave one for the other necessarily. Understand that — make the right decision because you can be successful in any one of those three fields, being a producer, being an agency owner, manager, etc., or having a career path inside of the company. And that was really an interesting conversation I had and that stayed with me my whole career. I chose to go the route of the company structure so I started that career path and it’s worked out fine for me, but I have very good friends that I started with in my 20s that have their own agencies today. We keep great contact and I’ve watched their careers, they’ve had great families, they’ve had a great life, and I also have a couple MDRT friends that I’ve started in the business with back in the mid 80s that are still MDRT, top of the table producers today, they went that path and they were successful as well.

Sandy: So, what advice would you give to somebody looking to get into the insurance industry?

Bruce: The best advice I can give someone coming into the industry, you really wanna just measure two things. One, pick a good company for what you’re trying to do. So if you’re going into the life insurance business, pick a company that is dedicated to life insurance business. Same thing if it’s property and casualty, etc. So take your time, do your due diligence on who you’re gonna affiliate with from a company standpoint, because that’s very important to you and to the customers that you’ll be serving. The next thing is I would always take the best managers. So, I’m interviewing, I wanna hook my way, you know, I would give a suggestion to go and find a manager with any company who understands the business and is willing to take you under their wing, mentor you, develop you, not let you fall through the cracks. The only reason why I’m successful is I had a very good sales manager when I was in my early 20s that didn’t let me leave the business, held me accountable. That person is a personal friend of mine today but I could have left the business three or four times in my early 20s and he kept on top of me and that allowed me to stay in this career over 40 years.

Sandy: What is the best opportunity the insurance industry can capitalize on today?

Bruce: We cannot miss the opportunity that COVID-19 has actually presented us. We were the only people that delivered checks to those millions of people’s families who passed away, people who were properly insured or insured, period, and succumbed to this horrible pandemic, their families got checks from one group, life insurance companies. And I believe that that is really the most important thing we should not lose. I think there’s an awakening on the public that you can’t sit down with somebody today and not have an open-minded conversation about covering your business, covering your family, covering your loved ones. I mean, we have got a great opportunity to really impact society right now. You can’t miss that opportunity.

Kevin: Bruce, thank you for your time today. It’s been great to learn more about you and how Pan-American is staying relevant and growing profits in a disruptive marketplace.

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