While the past 18 months have brought challenges for incentive meetings overall, it’s insurance incentives that are facing the harshest reality.
Back in 2008, the insurance industry was handed a blow of a particularly hurtful kind when the press exposed AIG’s infamous incentive spa weekend, just a short time after its government bailout.
The backlash was not pretty for the insurance meetings industry and gatherings started disappearing from sight.
"We haven’t really seen a lot of insurance business for the last year and a half or so," says Jim Mills, general manager of the Houstonian Hotel, Club & Spa in Houston. "It started to fall off prior to the AIG meeting. We used to do several training and recreation-based meetings, but then it all stopped."
According to Jan Hennessey, CMP. CMM, a Berkeley, Calif.-based independent planner and board member of Financial & Insurance Conference Planners (FICP), the word "incentive" is rarely even spoken in the insurance world these days.
"We call them brokerage programs or reward programs," she says. "If a company has one of these programs, almost everyone is taxing the recipient for their wife for the trip. It is compensation; it isn’t a present.
Dan Young, CMP, FICP president-elect and director of event planning and field recognition for Thrivent Financial, says some of the biggest trends he’s seen in the insurance industry include meeting merging.
"On the incentive side of our business, we’ve also reconstructed the entire field recognition and conference program," he says. "We’ve gone from three major incentive conferences to one conference. A lot of companies are eliminating smaller, ad hoc meetings. They are trying to get more focused on the dollars spent."
The Status
To gain a concrete sense of what is going on out there in the insurance meetings world, FICP asked insurance planners about the state of their industry at the association’s annual meeting in November 2009.
"We talked to 100 insurance and financial planners and asked them a few questions about insurance meetings today," Hennessey says.
First question: Is business moving toward normal and are you re-booking in 2010?
"Approximately 60 percent said they were re-booking," she says.
Second question: How are your budgets looking for 2010?
"About 90 percent said they were dealing with flat budgets and are planning meetings with what they had in 2008," Hennessey says.
Third question: Are you booking internationally?
"For that question, about 20 percent of planners raised their hands," she says.
What does all of this mean?
"I think private companies are not in as much trouble," Hennessey says. "The ones that are privately held are not under the same amount of scrutiny. But even so, companies are not doing the kind of extravagant meetings that they used to. On-site, we are trying to manage the risk of exposure. We don’t plaster logos around the hotel. We try to keep meetings low key."
Not So Luxurious
Insurance meetings, whether training focused or incentive, have largely been held at luxury properties in the past. Not so much anymore.
Lance Peters, director of sales for the Four Seasons Resort and Club Dallas at Las Colinas, has felt a significant shift in his group bookings.
"Generally, insurance is one of the top 10 industries we do business in," he says. "Within the past 12 to 18 months, changes in the economic climate have negatively affected the amount of insurance business we have seen here. Being a luxury property with all the things that happened in late 2008, we saw a reduction in some of our insurance business."
Hennessey believes the industry has changed for good.
"This is a new normal and I know some things aren’t ever going to come back," Hennessey says. "For example, the big, extravagant events with big name entertainers. People won’t have Bruce Springsteen playing at their event because they will be afraid of the media finding out and how that would look."
