Message from the President

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This October 17-19, the nation’s leading IMOs will gather in Scottsdale to share business ideas, network, and discuss the future of their distribution channel. To borrow from Mark Twain: the rumors of the death of independent distribution are highly exaggerated.

But first some background! Whether you consider the “I” in the acronym to be “independent” or you substitute “field” (FMO) or “national” (NMO), at NAFA we call them Insurance Marketing Organizations because they market annuites, life insurance, long term care and many other forms of insurance. NAFA’s IMO members represent about 95% of the indexed annuity marketplace, 50% of the income annuity space and about 70% declared rate annuties.

Since IMOs have such a large footprint in the annuity marketplace and NAFA’s mission is to promote the understanding and awareness of fixed annuities, IMOs represent a large part of our membership. In the fall of 2007, one of NAFAs Board of Directors believed that IMOs needed representation in a constructive forum. This gave people a place to express their concerns and talk about issues facing their businesses, as well as somewhere to identify solutions or find solution partners. This forum gives IMOs the opportunity to speak with one voice, so they can gain greater influence in the decisions affecting their ability to market insurance products. This individual was Bo Johnson, president of Financial Independent Group (FIG). Bo called me and asked NAFA to organize a committee to serve as that voice for IMOs. IMAC (the Insurance Marketing Advisory Committee) was born. Sadly, we lost Bo to lung cancer, but his vision and his passion for independent distribution lives on. Bo also conceived the IMO Summit where IMOs could gather together, leave competition at the door, and improve their opportunities, businesses, and outlook for fixed annuity sales.

IMAC and NAFA members chose to honor Bo’s spirit and courageous battle with cancer by sponsoring the Bo Johnson Spirit Award for Lifetime Achievement. Nominations were solicited in August and the recipient winner will be announced at the IMO Summit.

NAFA represents all fixed annuities and all participants in the fixed annuity marketplace, and we welcome any industry member that is interested in helping our mission to promote these incredible retirement products. Today, a quick look at the numbers shows us the influence and impact the independent channel has on fixed annuities particularly fixed indexed and income annuities – the only fixed annuity whose sales did not decline in 2011. According to LIMRA, independent agents sell almost 90% of all indexed annuities and 20% of income annuities. They also sell 11% of all declared-rate fixed annuities. The large representation of fixed indexed annuities is indicative of the channel. Independent insurance agents embraced the potential of the indexed annuity. At a time when the bond market was struggling and the declared-rates were challenged, the indexed annuity was a beacon for potential additional interest.

What about the rumor that the independent insurance channel is dead or dying? It is no secret to anyone, especially the owner or principal of an IMO, that the challenges of the tighter margins, additional demands from regulators and carriers, litigation and debit balance liability are putting severe pressure on their businesses. However, we have lived through these cycles before and we will survive – mostly because of the ingenuity and nimbleness of their business model. Also at the end of the day, because so many other distribution channels do not have the operational advantages and product selection opportunities that insurance marketing organizations have, many will continue to partner with IMOs. Today, banks and independent broker dealers represent an expansion opportunity for many IMOs and the product and operational support needed to successfully sell and manage compliance and regulatory issues.


Kim O’Brien is NAFA President & CEO. NAFA membership represents over 85% of all premium for fixed indexed, declared rate and income annuities written through the independent distribution system. Kim has over 30 years of experience in the insurance industry beginning as in 1981 as office manager for an insurance agency. In 2002 Kim developed and ran her own marketing organization and received the 2002 Entrepreneur Award from Sun Life. In between, Kim worked as a marketing executive for major insurance companies and was responsible for their annuity and term life insurance product line development, marketing, and training processes. In 1993, Kim served as interim deputy director of the Wisconsin Department of Insurance under Governor Tommy Thomson and served Governor Thompson until a permanent replacement could be found. In July 1992, Kim was the first women in Wisconsin to pass the CFP exam established in 1991 by the CFP Board as a single comprehensive examination modeled after the licensing examinations given to attorneys or Certified Public Accountants (CPAs). Kim O'Brien received her BA from Ripon College, her MFA from the University of Northern Colorado, and an MBA with an emphasis in Economics from Edgewood College, Madison, Wisconsin. In 2008, Kim was accepted into the Juris Doctorate program at the William H. Taft Law School and completed her first year and passed the preliminary California Bar as required before continuing her degree. She has recently re-instituted her studies to begin this summer after a hiatus due to her NAFA workload. As an avid musical theater fan and dancer, Kim has directed or choreographed over 60 shows in Milwaukee and Madison, Wisconsin. She lives with her husband and college sweetheart of 39 years, Kelly, in Phoenix nestled in the Thunderbird Conservatory she enjoys hiking the mountains with their Irish setters.

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