The technology offering includes a proprietary commission management sofware that works in tandem with Signal’s commission advance program.
According to Signal Advisors, during Covid-19 advisors and insurance agents are waiting over 50% longer to receive commissions for the sales of annuities. The amount of time it take to be paid a commission has stretched from an average of 33 days immediately prior to Covid to 53 days between March 15 and July 31st. The delays were primarily due to back-ups in suitability queues, lack of digital workflows and funding delays.
Advisors rely on timely commissions to enable them to turn around and reinvest in marketing, and slower commissions mean that they aren’t able to conduct as much marketing this year, leading to a slowdown in new business.
“We find that most independent advisors are business owners dealing with a lot of capital constraint, and marketing is what drives their business,” said Kelly. “We have a line of credit that allows us to pay commissions within 24 hours of an application being submitted, as long as it's in good order. That offers advisors the time to keep filling the top of their marketing funnel,” allowing them to increase their marketing spend by approximately 33%.
The commission advance program is available to Signal Advisors users at no additional cost.
At launch, Signal will work with more than 30 insurance carriers, including American Equity, Fidelity and Guarantee, Allianz, Equitable and Guggenheim.
Signal Advisors was founded by a three-person partnership: Kelly, a financial advisor who has served with Northwestern Mutual as well as his family’s independent advisory firm, Kelly Capital Partners; Cohen, a 10-year veteran of several technology startups; and Chief Technology Officer Kevin O’Hara, who has served as chief technologist at several tech firms.
While Kelly describes most independent marketing organizations as “bootstrapped” businesses with two-to-three people conducting most of the work behind the scenes, Signal Advisors is backed by venture capital.
Kelly and Cohen declined to name the company’s investors, but mentioned they include firms and individuals interested in both tech start-ups and financial firms.