Over the course of my career, I have worked for carriers and marketing organizations, as well as personally selling insurance products. As a result, I have had the pleasure of meeting many thousands of individual agents, from those who are struggling to those who are fabulously successful, and I have observed and analyzed what agents do differently that leads to differing levels of sales results.
There are many paths to success in this industry, which is an aspect of our industry that makes insurance such a great place to build your career. But as carriers and marketing organizations have cut back on training, individual agents must work harder to figure out their path to success, and often that requires trial and error, trying out one sales system after another.
Most carriers and many marketing organizations work with thousands of agents. If you were to pick the top agents out of that group, here are the characteristics you would typically find:
- They don't win business based on price. While they have the ability to offer products with competitive pricing, their customers spend considerably more on insurance products than do most consumers. And that's because...
- They help people see the need for insurance products. Before meeting an agent, consumers generally see insurance products as, at best, a necessary evil, and they would prefer to spend as little money as possible on them. The best agents are able to make their customers see how insurance products help them achieve and maintain what they really care about -- long-term financial security.
- They make sales of multiple products to each client. This is because they don't limit their conversations with clients to just one type of product. Over time, they are able to convince clients of the value of owning annuities, life insurance, disability insurance, long term care insurance, and so on.
- They make bigger sales than other agents. They do a superior job winning clients over to the view that owning larger amounts of insurance is key to achieving long-term financial security.
- They become the client's primary financial advisor. They don't limit their conversations with clients to just one type of product; rather, they examine and discuss the client's entire financial situation. When you help clients understand how they are going to achieve and maintain long-term financial security, they view you as much more than just an insurance agent.
- They have proven methods to get new customers. All the prior steps address how the most successful agents handle each customer, but of course, the most successful agents have also figured out what works for them to consistently attract new customers. This can be word-of-mouth, personal networking, advertising, direct mail, seminars, or any of a variety of methods, but they must be applied consistently and continuously.
- They don't stop growing the business. Many agents do what the best agents do, at least at first. But then they reach a certain level of business activity and stop doing the activities that grow their business. I once had an extremely successful agent tell me that he had to constantly remind himself, "Don't run the business, grow the business." When he found himself spending too much time running the business, he knew it was time to hire an additional staff member.
- The result is that they have more clients and make bigger sales.
Let me give you an example of how this works with an individual client.
One day, a neighbor who knew I was in the insurance business brought over his $1 million, annually renewable one-year term insurance policy. He is a medical doctor with a high income, but modest assets. He had just received his annual premium bill, and with this type of policy, the premium increases every year. He asked if I could get him a better price on his $1 million policy.
So, let's examine my neighbor's thought pattern, because it is typical of your prospective clients.
- Based on gut feel, he viewed $1 million as plenty of life insurance on himself. After all, $1 million is a lot of money.
- He had no life insurance on his wife since her income is a small fraction of his income.
- He wanted to spend as little on life insurance as possible. (That's why he had previously bought a one-year term policy. Of all the forms of life insurance, it has the lowest initial premium.)
Using the techniques I had learned from great agents, how did I change my new client's mindset?
First of all, I told him that yes, I could most likely find him a better deal. But first, was he willing to share with me what questions or concerns he has about his long-term financial security? He let me know that he was wondering if he could afford to send his two young children to private school for all grades K through 12, could he retire at age 60, and how much money would he need to have at that time to comfortably retire. By asking many questions about his income, assets, expenses, and liabilities, I was able to put together a financial projection for him that answered his questions.
I was also able to show him what would happen to his family if he died and his family received the $1 million in life insurance proceeds. The bottom line is that his wife would run out of money within twenty years. We also discussed what impact it would have on his career and his desire to spend so much time at the office if his wife died.
As you would suspect, he then asked me, "How much life insurance do I need?", and what type of life insurance should it be. He ended up buying a $2 million 30-year term policy on himself, and a $1 million 30-year term policy on his wife.
Now notice, his motivation in coming to me was to spend less on life insurance, and he ended up spending much more. But here's the thing - for the first time, he really understood and believed in the value of life insurance to improve his family's long-term financial security, and that changed his view completely. I am now my neighbor's primary financial advisor.
Almost every agent wants to have more clients and make bigger sales. To help you, I plan to share more on this topic in future articles, with more concrete ideas of how you can improve your sales results.
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