Asking the Experts

[newdirection]

I do Med Supp leads for my agents. One lead is a soft lead with a 2% return and about 10% in sales. The lead cost me about $11.65 each. The other is a hard lead with a .68% response ratio but 40% in sales. The cost of that lead is $34.26. At the end of the day the agent makes a little more commission on the hard lead than the soft with a lot less running around to see the people (less expenses). The problem I have is the agents do not want to pay $34.26 for the hard leads and there is not enough override in Med Sup sales for me to help with the cost of the lead. Any suggestions?

 

[GreenSky]

Find more intelligent agents.

$35 per lead and writing 2 out of 5 is a great deal.

Rick

 

[Yoda]

I do Med Supp leads for my agents. One lead is a soft lead with a 2% return and about 10% in sales. The lead cost me about $11.65 each. The other is a hard lead with a .68% response ratio but 40% in sales. The cost of that lead is $34.26. At the end of the day the agent makes a little more commission on the hard lead than the soft with a lot less running around to see the people (less expenses). The problem I have is the agents do not want to pay $34.26 for the hard leads and there is not enough override in Med Sup sales for me to help with the cost of the lead. Any suggestions?

The business proposition of building an agency made up of agents selling medicare supplements took a torpedo when the standardized plans came out with level commissions. I said at the time it would be the death of med supp agencies and I was told by many leaders of those agencies I did not know what I was talking about. None of those agencies survived! The math dont work.

 

[HarryRenard]

It might be a lost cause for the agents you have now but in the future maybe lower the comp a little to help subsidize the cost of leads for ne hires.
Just to get the cost down not cover the total price of the leads.

 

[Frank Stastny]

I do Med Supp leads for my agents. One lead is a soft lead with a 2% return and about 10% in sales. The lead cost me about $11.65 each. The other is a hard lead with a .68% response ratio but 40% in sales. The cost of that lead is $34.26. At the end of the day the agent makes a little more commission on the hard lead than the soft with a lot less running around to see the people (less expenses). The problem I have is the agents do not want to pay $34.26 for the hard leads and there is not enough override in Med Sup sales for me to help with the cost of the lead. Any suggestions?

I would be willing to make a guess that the "hard leads" you sell are only sold to agents who have a very smooth phone presentation and know how to maintain control of the call and turn it into a conversation.

Will you please define the difference between a "soft lead" and a "hard lead"? Also how are these leads generated? Are these considered "appointments" or is that the agent's responsibility to set the appointment?

I generate my own leads and a "hard lead", by my definition, is when I know how much the senior is paying and they know exactly what the premium will be if they take a policy from me.

A "soft lead", to put a name to it, would be where I know the name of the company they currently have their insurance with. If that is all the information I glean from the phone call that person is safely tucked away in my prospects database and will sit there until the company has a premium increase. At that time the "lead" becomes as hard as a diamond.

I stopped doing "Medicare Reviews" years ago. When I set the appointment they know I'm coming to fill out an app, get a signature and pick up a check. There is too much windshield time and money spent on gas for me to consider anything less than that an appointment.

 

[sman]

Really? I know an agency that does over $50 million in Med Supp premium each year. If they only make 2% that's a million dollars a year in first year commissions, not to mention the renewals. I guess the math "do" work for them.

The business proposition of building an agency made up of agents selling medicare supplements took a torpedo when the standardized plans came out with level commissions. I said at the time it would be the death of med supp agencies and I was told by many leaders of those agencies I did not know what I was talking about. None of those agencies survived! The math dont work.

 

[newdirection]

I would be willing to make a guess that the "hard leads" you sell are only sold to agents who have a very smooth phone presentation and know how to maintain control of the call and turn it into a conversation.

Will you please define the difference between a "soft lead" and a "hard lead"? Also how are these leads generated? Are these considered "appointments" or is that the agent's responsibility to set the appointment?

I generate my own leads and a "hard lead", by my definition, is when I know how much the senior is paying and they know exactly what the premium will be if they take a policy from me.

A "soft lead", to put a name to it, would be where I know the name of the company they currently have their insurance with. If that is all the information I glean from the phone call that person is safely tucked away in my prospects database and will sit there until the company has a premium increase. At that time the "lead" becomes as hard as a diamond.

I stopped doing "Medicare Reviews" years ago. When I set the appointment they know I'm coming to fill out an app, get a signature and pick up a check. There is too much windshield time and money spent on gas for me to consider anything less than that an appointment.

I do direct mail leads. Soft lead is like the ones from the lead companies. They hardly know why you are contacting them but a good agent can work some magic on the phone and get some appointments. The hard lead has our agency name, that if they respond they will be getting a call from an insurance agent to discuss their premium and to save them money. I have one agent closing 50% of these leads. The only reason he said he does not write more is health conditions. He has written some med advantage and aarp but its not a fit for everyone. Most of his sales are med supps.
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The business proposition of building an agency made up of agents selling medicare supplements took a torpedo when the standardized plans came out with level commissions. I said at the time it would be the death of med supp agencies and I was told by many leaders of those agencies I did not know what I was talking about. None of those agencies survived! The math dont work.

Of course the med supp is still the best door opener. Agent must sell other products such as final expense to make a living.

 

[Frank Stastny]

Of course the med supp is still the best door opener. Agent must sell other products such as final expense to make a living.

I disagree. All I sell right not are Med Supps. FE does not lend itself to an easy cross sell when selling Med Supps over the phone. (Because of time constraints, most of my Med Supp sales are over the phone.) An agent can make a lot of money just selling Med Supps. Cross selling FE is just a bonus to the Med Supp sale.

Regarding the difference between your "hard leads" and "soft leads", I think you are charging way too much for your "hard leads". I assume your agent have assigned their commission and you are probably making a respectable override on their sales.

The mailing costs you the same whether or not it has your agency name on it. It sounds like you may be trying to make too much money on the sale of your "leads" especially if you are making commission from each sale they make.

Teach your agents how to prospect and squeeze every drop of "sales juice" out of each "lead" they get. Try selling or giving the "old, no good" leads to your better agents. The ones other agents have given up on just because the prospect said they "weren't interested".

When I was captive those are the only ones I worked. The manager gave those to me for free.

 

[Josh]

Find more intelligent agents.

$35 per lead and writing 2 out of 5 is a great deal.

Rick

I have to completely agree.

 

[newdirection]

I disagree. All I sell right not are Med Supps. FE does not lend itself to an easy cross sell when selling Med Supps over the phone. (Because of time constraints, most of my Med Supp sales are over the phone.) An agent can make a lot of money just selling Med Supps. Cross selling FE is just a bonus to the Med Supp sale.

Regarding the difference between your "hard leads" and "soft leads", I think you are charging way too much for your "hard leads". I assume your agent have assigned their commission and you are probably making a respectable override on their sales.

The mailing costs you the same whether or not it has your agency name on it. It sounds like you may be trying to make too much money on the sale of your "leads" especially if you are making commission from each sale they make.

Teach your agents how to prospect and squeeze every drop of "sales juice" out of each "lead" they get. Try selling or giving the "old, no good" leads to your better agents. The ones other agents have given up on just because the prospect said they "weren't interested".

When I was captive those are the only ones I worked. The manager gave those to me for free.

My agents are paid direct by the insurance company and my override is only 2% to 4% depending upon the company. That's why I can't cost share with the agent. The lead cost $35 each and are really good leads. But you are right in the agents need to learn to prospect a lot better.