Let's face it, with the current struggling economy and high unemployment rates, getting in the prospect's door to sell life insurance has become increasingly difficult for most life insurance agents. Especially for those agents who are just pushing a life insurance product, instead of helping people find a solution to a problem.
If you want to succeed selling life insurance today, then you must find a problem that most people quickly recognize and want to solve.
These days, job security is a thing of the past for many Americans. Companies that manage to stay afloat in the current market are usually forced to cut staff. Employees who have worked in the same position for years, even decades, find themselves out of work, with no income or benefits. But should a person who has fallen victim to the current economy lose their home, too? Isn't the home mortgage the biggest financial expense for most families?
Mortgage protection insurance is now more important than ever, and it's a great door opener. It’s a perilous time for homeowners; the loss of income from death, disability or losing their job can result in the loss of a family's home. One of the best ways to prevent that outcome is through mortgage protection, using cash value life insurance. Note: While there are life insurance policies specifically designed for mortgage protection, any type of life insurance can be used to cover the mortgage and can be used in combination with disability income insurance.
And while most people are not very open to discussing life insurance, they are open to a discussion about their mortgage payment disappearing. Isn't the "Great American Dream" to have your mortgage paid in full?
The great part about offering mortgage protection insurance is your ideal prospects are all around you. Anyone who has had a mortgage for a while is a good prospect. They are your neighbors, your friends, your family, your current clients, your past prospects, your dentist, your hairdresser, your auto mechanic and so on. Aren't these the people you have the best chance of setting an appointment with? Aren't these the people you care about and want to help?
Consider, in today's environment the best way for you to set an appointment is by helping your prospects to identify the problem (or pain) that they have. And the only way you can do that is by learning to ask them the right questions, to get them talking about their situation; to have a real conversation with them. Most homeowners are quickly able to see the value and importance of having a life insurance policy to protect their family from losing the roof over their heads if they are not able to be there.
Once the prospect agrees they have a problem and that they want to solve it, then you'll want to ask the following question to set the appointment:
"If I could show you how to get all the life insurance you need to protect your family and pay off your home five to 15 years early without taking additional money out of your pocket or sacrificing your current life style, would it be worth sitting down and talking about?"
Conducting a full fact-find
If you can’t imagine yourself asking these questions of people you don’t know very well, I’ve got a little trick for you. Imagine that the prospect sitting across from you is a family member. Feel the emotional connection. Be yourself, and let the passion that comes with being a financial professional emanate from you. Your sale, but more importantly, their life and happiness, depends on it.
Paying off a mortgage early may be the most expensive mistake of your life
If you make extra payments towards the mortgage principal, aren't you significantly reducing your income tax write-offs in the early years?
If you make extra payments towards the mortgage principal and then you lose your job or become disabled, can you get at the extra money you've paid into the mortgage? In most cases, you're much better off financially if you put those extra payments into cash value life insurance, so you have a liquid cash reserve (an emergency fund).
Don't confuse mortgage protection insurance with private mortgage insurance
Many people routinely mistake private mortgage insurance (PMI) for mortgage protection insurance. Mortgage protection insurance is a life insurance policy with disability insurance that will pay off a borrower's mortgage in the event of the borrower's death, or will make the mortgage payments if they become disabled. Private mortgage insurance (PMI) has nothing to do with this type of coverage.
Private mortgage insurance (PMI) just protects the lenders against a loss if a borrower defaults on the mortgage, but the borrower still loses the home. In the past, mortgage lenders were not permitted to make home loans without the borrower providing at least a 20 percent down payment. The risk was perceived as too great in case the borrower defaulted. As was demonstrated in the 1980s, even 20 percent equity in a property can disappear quickly during market downturns.
With the introduction of private mortgage insurance, mortgage lenders were permitted by federal agencies to make loans as high as 97 percent of the value of a property. The mortgage insurance company protects the lender against some, but not all of the loss in the event of a default.
Many home buyers consider private mortgage insurance a hindrance to home ownership. In fact, the reverse is true. Without it, most lenders would simply require higher down payments of 20 percent or more. Since saving for a down payment represents one of the largest obstacles to buying a home, private mortgage iinsurance (PMI) plays an important role in the home buying process.
Help your prospects to understand what they actually have and the problems they face today. And have a real discussion with them about mortgage protection insurance. It's one of the simplest ways for you to get in the prospects' door, help your prospects and make consistent life insurance sales.