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Primerica MLM Compensation plan review 2.0

Introduction to Primerica MLM Compensation plan

When it came time to do research for my Primerica review, the first thing I found out was that, although the list of Primerica products includes a variety of insurance policies and financial services, the product for which the company is the most well-known is term life insurance.  I started thinking of movies that depict characters who sell insurance.  I have previously written here on the pages of Notebook Crazy about how Charlie, John Goodman’s jolly, down to earth insurance salesman character in Barton Fink, is one of my favorite characters in the history of cinema, but as I started researching movie insurance salespeople, I discovered that there are many more.  In fact, several websites that take the insurance business as their primary subject matter have made extensive lists of movies in which insurance forms a major plot point (usually because a character wants to collect a relative’s life insurance policy on which he or she is listed as the beneficiary) or in which one of the characters works in the insurance industry.  I found a few movies that portray the insurance industry and its employees in very different ways.

Just about the only movie I can think of that makes working for an insurance company look cool is The Thomas Crowne Affair.  Faye Dunaway’s character is an investigator for an insurance company; her job is to find out whether insurance claims are fraudulent.  Dunaway plays the character as a femme fatale, someone you would no sooner want to offend than you would want to get on the bad side of the characters she played in Bonnie and Clyde and Mommie Dearest.  But this movie is an exception.  Most other movies portray the insurance industry as, at best, a very dull place to work.

Hollywood’s vision of the insurance industry is much more typically embodied by Reuben, Ben Stiller’s character in Along Came Polly.  Reuben’s job with a life insurance company involves analyzing risk, and analyzing risk has become a nearly inseparable part of his personality.  His fixation with risk stops him from doing anything even the slightest bit spontaneous or daring.  Even eating dinner in a Moroccan restaurant in his home city of New York seems frighteningly risky to him.  (Although not during my current visit, I have previously eaten Moroccan food in Chicago, and while it was flavorful, none of it was even a little bit spicy.  I can’t imagine what Reuben was afraid of.)  The fact that the other characters in the movie are so unafraid of risk only highlights how cautious Reuben is, whether it is Jennifer Aniston’s character Polly, who lives from one split second decision to the next, or Philip Seymour Hoffman’s character Sandy, who is a big fish in a small pond in the community theater.  Hollywood goes way out of its way to make being an insurance salesperson look like the absolute most boring job in the world, which means that Primerica has its work cut out for it as far as making selling insurance look like a glamorous multilevel marketing (MLM) business opportunity.

Naturally, I was curious about what kind of dream the company would try to sell to people to lure them into becoming Primerica distributors.  With nutraceuticals, the gimmick is usually to talk up how some exotic super-fruit can make everyone healthy and thin and how people will line up around the block to buy the stuff.  With MLMs that sell cosmetics, costume jewelry, or handbags, the gimmick usually involves expecting women to believe that their female acquaintances have nothing better to do than attend “parties” where they are pressured into buying these overpriced items and that they will want to become distributors of these items, because, ostensibly (in the minds of the people who designed these MLMs), this is the only career opportunity available to women.  And then there are the MLMs that sell something so unusual and weird that it is almost impossible not to stand up and take notice, whether it is the hologram placebo patches of CieAura, the cannabis oil extracting machines of Healthy Headie, or the tiny pieces of gold bullion sold by Karatbars.  How do you make selling insurance sound edgy, or how do you make it sound like a road to riches?

Primerica: The Company and Its Products

 

primerica
In a lot of ways, Primerica is the exact opposite of what you would expect an MLM business opportunity to be.  Its headquarters are in Duluth, Georgia.  While MLM is quite strong in the South, Georgia is not one of the states where a great number of MLM companies have their headquarters.  While you occasionally do find MLM companies that are subsidiaries of other, much larger companies (for example, I recently reviewed Touchstone Crystal, which is a subsidiary of Swarovski), Primerica was, for much of its history, a subsidiary of the corporate behemoth Citigroup.  I always wonder what big companies have to gain by starting MLM business opportunities.  Swarovski and Citigroup have plenty of sources of income selling things that people actually need and want; what would persuade them to get involved in MLM, where people who don’t have any money sell useless items and unattainable dreams to other people who don’t have any money?

The company was founded in 1977 by Arthur L. Williams, and it has been known as Primerica since 1987.  The Wikipedia article on Primerica goes into all the details about the various companies with which it has merged, including its affiliation with Citigroup.  Primerica has been separate from Citigroup since 2010.

The most well-known of the Primerica products is term life insurance, but the Primerica website actually lists quite a few different services that Primerica distributors can market to potential customers.  It offers car insurance and homeowners’ insurance, as well as a service called DebtWatchers, which, according to the Primerica website, makes it easy for you to keep an eye on your credit score.  The “investment” page of the products menu of the Primerica website is especially vague.  It talks about Primerica’s philosophy of investment, but it is not very specific about what customers can buy that will help them with their investments.

According to the Primerica reviews I read, the materials designed to recruit new Primerica distributors downplay the MLM aspect.  Instead, they try to convince you that you stand to make a lot of money by selling term life insurance to your family and friends.  There are meetings in the conference rooms of motels in uninteresting suburbs, and these meetings involve a considerable amount of hype (and, allegedly, stooges who pose as Primerica distributors who have made a lot of money through the Primerica business opportunity), but at least there are no home sales parties.

The Primerica Compensation Plan

The aspect of the Primerica compensation plan that looms the largest in the minds of the authors of the other Primerica reviews that I read while researching this Primerica review is that it pays commissions on a whopping eleven levels of downline.  The Primerica website really does not hype the fact that Primerica is an MLM company.  IN fact, it gives almost no details at all about the Primerica compensation plan.  It just makes some vague statements about how joining the Primerica business opportunity could mean that you never again have to work for a boss.

Advantages and Disadvantages

Advantages

  • The good news is that Primerica products are not nutraceuticals, and therefore they cannot pile up in your basement. According to some other Primerica reviews I read, the company itself has even pointed out this fact as a selling point in order to attract more Primerica distributors.  The bad news is, what does this tell you about the state of the MLM industry if an MLM company already has to answer the implicit question of what happens when distributors are unable to sell merchandise.
  • The Primerica website gives the impression that a substantial portion of Primerica distributors are male. I find this refreshing, since in my experience, a lot of non-nutraceutical MLM companies seem to be almost exclusively female-oriented. While I am definitely of the belief that MLM is not the best way to make money, I do like to see companies be inclusive of both sexes, especially since the female-oriented MLM companies tend to feed into gender stereotypes that give me the creeps, and I am not the kind of person who is easily offended by gender stereotypes.
  • While there are lots of ways I would rather spend my time than at a Primerica recruitment meeting in a motel conference room, it is at least an improvement over MLM home sales parties. At least MLM recruitment seminars are honest about the fact that they are trying to get money out of you, and there are usually coffee and Danishes provided by the hotel.  All of this is an improvement over the falseness that surrounds MLM home sales parties, the charade in which people are supposed to pretend to enjoy the event, and the pressure not to say no to a friend who spend a substantial part of her paycheck to host the party.  At least recruitment seminars are a bit like going to mandatory staff meetings at a soul-sucking job, where you get a few hours of your time wasted by delusional windbags, but at least you can partake of the free coffee and Danishes with a clear conscience.

Disadvantages

  • I read one Primerica review that said that 7 out of 10 new Primerica distributors drop out of the Primerica business opportunity before ever selling a single insurance policy. Of the ones who do stay in, the great majority of them do not make more than $5,000 per year, which hardly even counts as a lucrative side gig, much less a full time income.  This is a problem that plagues the MLM industry as a whole, and for an MLM company to really stand out to me as a good opportunity, it has to do better than that in terms of success rates.
  • While the company does provide Primerica websites for its distributors, Primerica distributors are not allowed to distribute Primerica products through their own websites. Generally speaking, it is not a good sign when an MLM company puts a lot of restrictions on the ways in which distributors can market the company’s products or services.
  • Likewise, it is bad news when an MLM company tries to convince you that you can make a decent living by selling its products to your “warm market” of family and friends. Imagine if everyone you knew bought a life insurance policy from you.  Would that give you enough money that you would be able to afford to quit your 9 to 5 job?  Even if you sold one to each of your many Facebook friends, no one person needs more than one term life insurance policy.  It simply is not a sustainable business model.

Conclusion

The only reason I can possibly think of that Primerica ended up on my list of the top ten money making MLMs is that, at the time that the other Brad and I originally wrote our top ten list, we just didn’t know about most of the MLM opportunities out there.  Even now, I’m not really sure I would want to remove it from the top ten, because I cannot think of anything to put there in its place.  I guess its virtue is that, while the chances are very small that you will ever make enough money through the Primerica business opportunity that you can rely on it as your sole source of income, it probably isn’t going to send you borrowing out of control to keep up with the autoship requirements.  An MLM company where you lose a little money is better than one where you lose a lot.  In that regard, the Primerica business opportunity is safe.  And that is something that Ben Stiller’s character in Along Came Polly could definitely appreciate.

Did I miss any really interesting insurance salesperson characters?  Schedule a call with me and let me know.

 

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