Registered Rep.: Why did Jackson National get into the broker/dealer business?
Jim Livingston: Jackson was distributing its products through about 800 outside independent broker/dealers back in the 1990s. The chief distribution officer at the time, Clifford Jack, thought it would be a better idea to own some of our own b/ds, to better understand them. In the late 1990s and early 2000s, the four b/ds were bought and assembled.
RR: Do your reps sell primarily Jackson products? What kind of access do they have to third-party products?
JL: We offer variable annuities from 20 of the largest manufacturers on our platform. Advisors have access to ING, Prudential, Pac Life, The Hartford, John Hancock and more. They're not pressured to sell Jackson's products.
RR: What do you think your biggest selling point is for recruits?
JL: There are several things. But we think we have the best platform in the IBD space. I'm sure every firm will tell you that. But we've taken a lot of the paperwork out of the office. Advisors at our b/ds can open mutual fund accounts with the largest vendors — that's about 90 percent of our mutual fund business — electronically, without the paperwork. We are doing the same thing for variable annuity accounts now, and hope to have that rolled out in the next 18 months.
RR: What's the most significant benefit of being owned by a large insurance company?
JL: Jackson National has deep pockets. These days, that is valuable to advisors who want to know there is a good deal of financial backing at the firm they are affiliated with. We have access to capital and are able to expand the business with that money.
Number of Broker/Dealers: 4 (INVEST Financial Corp., Investment Centers of America, National Planning Corp., SII Investments)
Number of Advisors: 3,535
Revenue (half year 2009): $284 million