The Hartford has launched an awareness campaign to capture a bigger chunk of the fast-growing employer retirement plan market. "This is truly an underserved market. Fifty percent of companies with 100 employees or less still don't have a retirement plan today, and others need help in managing the one they have," Jim Davey, senior VP and director of The Hartford's Retirement Plans Group, said during a panel discussion in New York this month.

   Fewer than 20% of financial advisors today are actively engaged in selling retirement plans, he said, despite the huge potential for increased fees in a market projected to grow 9% to 10% annually over the next few years, according to studies. Current assets under management for 401(k) plans total $3 trillion, $700 billion for 403 (b) plans and approximately $125 billion for 457 plans.

   Davey was joined by Tom Foster, national spokesman for The Hartford's employer retirement plan business, and Todd Thompson, vice president of the North Central Division. Both are co-authors of "To Sell or Not to Sell ... Employer Retirement Plans," (Kaplan Publishing, 2007), a how-to guide for advisors that the company is using as a business-building tool.

   The overall message was that the employer retirement plan market offers a broad opportunity for advisors today. According to the participants, advisors can significantly grow and diversify their practice, build a future guaranteed income source, and also gain access to myriad of ancillary sales opportunities by focusing at least a portion of their practice on doing business and helping clients implement various plan structures. Many factors make the market less of a challenge than it has been in the past, they said.

   Davey noted the importance of the recently passed Pension Protection Act of 2006, which provides guidelines so financial advisors can offer better advice to plan participants and also enrolls employees automatically in their retirement plans for the first time. In light of relatively small Social Security benefits, declining corporate pension benefit plans and reduced personal savings, he said, such employer retirement plans, particularly the 401(k), are "about the only way Americans will save on their own" for retirement.

   The Hartford has retirement plans for small, mid-sized and large companies, educational institutions, and public entities. Altogether, the company has 16,000 such plans on its books. The firm encourages advisors to take a "solutions based" rather than a product approach with clients in selling such plans. Foster stressed the importance of simplifying what can be complex themes for clients. "By doing so, the advisor will differentiate himself or herself and can be successful in this business," he said.

   Forster went on to describe recent campaigns where The Hartford introduced new and emerging retirement plans, such as its 2005 Roth 401(k), and its recent efforts on behalf of the Pension Protection Act.

   Often, it was pointed out, some advisors have had misgivings about selling employer retirement plans for various reasons, namely their complexity, costliness and long commitment requirements, as well as long sales cycles. While that's still true to some extent, the Hartford retirement experts noted many misconceptions have been allayed. Thompson said the sales cycle, for example, has been reduced from roughly one year to 90 days or less in some cases. "You still run into slightly longer cycles, but the majority of sales cycles have been reduced," he said.

   Thompson said advisors don't necessarily have to be expert in retirement plans; they can work with one of the firm's 100 regional retirement plan specialists dispersed throughout the United States. "We like them to position themselves as a relationship manager and lean on us as the technical manager," he said.

-Bruce W. Fraser