Bob Huang: Okay. Thank you. My follow-up is on the Senior Health side. You talked about LTV to CAC of about one currently. It feels like the segment has been facing some challenges for several quarters now. Just curious how we should think about growth, scale, profitability and how to improve that LTV to CAC ratio?
Glenn Williams: Yes. We are working on that on all fronts. I mean that is the blocking and tackling of that business is the relationship of LTV to CAC. And so as we’ve seen, there are dynamics that we can control, the sales, the quality of sales. And then there are issues that happened to us like this quarter, when we had Change Healthcare, the industry-wide provider, went down due to a cyber-attack. I think that’s well known, not just in our — this industry, but across the health insurance business, and that certainly impeded sales. So there are outside factors that we have less control over, and we’re learning some hard lessons on some of those as we go. But as I said in my prepared remarks, we did feel like we wanted an outside perspective, and so we brought in a global consulting firm and spent significant time understanding the industry, the market and which direction we thought the trends were going.
And there are still a number of unknowns and some bumpy waters, bumpy road ahead. But at the same time, we do believe the opportunities continue to exist. As I said in my remarks, we do believe we have an advantage with the Primerica sales force that’s unique to us. And we do believe, over time, we can work through the challenges and build this to a profitable and sustainable business. As we said, it’s not going to happen this year. As we look forward and have more clarity going into 2025, we’ll keep you posted on when we think the numbers will be significantly different than they are today. But we’re certainly giving it, I believe, the right amount of focus and using the right resources to get the answers to those questions.
Bob Huang: Thank you very much, sir.
Operator: Thank you. The next question is coming from Suneet Kamath of Jefferies. Please go ahead.
Suneet Kamath: Good morning, Glenn. I think you just answered my question, but I’m going to go ahead and ask it anyway. Have you thought about just shutting down the Senior Health business? And the reason I ask is sort of twofold. Number one, your core businesses are performing very well despite the economic pressures that you’ve talked about. And then number two, we did see another company that got into a sort of a tech-enabled distribution platform go down that same path where they decided to shut it down. Clearly, this is not the business that you thought it was when you bought it, but was that ever a consideration?
Glenn Williams: Suneet, as we have reviewed it internally and particularly with those external resources, we looked at all possible options as well as the sequencing of being able to avail ourselves of those options. So the answer to the question is, yes, we’ve looked at all the possibilities. We’re aware of that situation that you mentioned, although I think it has some very different characteristics. There was a tremendous amount of capital being deployed against that business that was recently shut down by a competitor. And we’re not seeing that. It’s — we’re not putting capital into the business, and that’s one of the reasons that we slowed it to the point we did, so that we could understand it before we needed to start making investments in it.
So we’ve looked at all that and we do believe at this point that there is a path to success, to sustainable profitability. We are putting capital in it as we learn the business. And so we feel like there’s not a tremendous amount of pressure, but we are looking at all options as we go forward, and we’ll continue to assess how those make sense as time goes by.
Suneet Kamath: Got it. Okay. That makes sense. And then just on the tail revenue adjustment that you made, can you just unpack that a little bit in terms of what drove that? And do you see that as sort of a one-and-done phenomenon? Or is this something that we could see in future quarters?
Glenn Williams: We’re going to Tracy for that.
Tracy Tan: Good morning, Suneet. How’re you doing? Suneet, to talk about the tail adjustment, and it really is driven by the loss of policies due to increased policy churn during the renewal process. And given really the competitive carrier dynamics that we saw and the weakness in the AEP that we had previously disclosed. In terms of tail, as we look forward, I want to just emphasize the seasonality of the business. Fourth quarter is really where the AEP happens, there’s a lot of volume coming through. And first quarter is when OEP happens where people can make their minds up and make switches, if they need to, between carriers. So that’s really where the volume come through and where you would see the big tail adjustment. So you’re not going to be expected to see the similar level of scale of tail adjustments even if there was some.
Suneet Kamath: Got it. And then if I could just sneak one more in, just a follow-up to Ryan’s question on field force management. I don’t know if you’ve given the statistic, but do you know the percentage of your sales force that exclusively focuses on Primerica product as their only job versus those that have another job, be it teachers or what have you?
Glenn Williams: Yes. That is moving target, Suneet. Suneet, if I could add one more comment to what Tracy said in your earlier question, and I’ll circle back to that one. If you’re looking for a silver lining in what happened with the movement from carrier to carrier because that is, as carriers improve their products and their features, people tend to reshop, we’re all aware of that. But as we saw that happen during this AEP, we did see a balancing of our providers. We were very heavily weighted into a single provider. And after the smoke cleared, after this, after people moved around, we see a much better distribution among our providers, which gives us some comfort that we have a more balanced diversification among providers.
