tnyankee3
New Member
- 12
In your opinion, what are the main reasons for policy cancellations and what do you do to help ensure customers keep their policies?
Chargebacks & Keeping Business on the Books
- Thread starter tnyankee3
- Start date
- 15,041
Money was already spent before the draft hit. Absolute number one reason for chargebacks, all lines.
If it is an NSF, that is why. Once in a blue moon, something else causes the NSF, but mostly it is they already spent the money. And again, that isn't FE specific.
If they call and cancel or ask to go off draft, either they got cold feet or you are getting replaced.
If it is an NSF, that is why. Once in a blue moon, something else causes the NSF, but mostly it is they already spent the money. And again, that isn't FE specific.
If they call and cancel or ask to go off draft, either they got cold feet or you are getting replaced.
- 19,667
Being oversold in the beginning is the biggest problem I see where agents get chargebacks.
I've replaced several where not only could I save then $10 a month or so on the same coverage but we also reduced the face to save them $30 or $40/mo. Everytime that's happened it was because the agent upsold them.
In the FE market you have to find a comfortable monthly premium from the start. Sure everyone wants $10,000 coverage or more but if they can't pay that premium every month it's useless to sell it to them. If $6000 face is a btter fit for the budget then go with that.
I tell all my clients that's it's better to start smaller and then add to it later than to call me in 3 months to cancel.
And if we get down to talking dollars they can spend instead of face amount I will always go under what they said. For example, if they say $40/mo is all they can afford then I will place at no more than $35/mo.
The other thing is that the FE is all about procrastination. These folks didn't get to be 65-70 years old and not have their funerals taken care of because they have been good planners and good money managers.
There will be missed drafts from closed accounts, NSF's, etc. I contact every single one as soon as I know there is a problem. Most times when I call they don't even know yet that there was a problem. I'm proactive on getting the problem fixed. Whether that's getting a new PAC form to them or calling the company to redraft.
No one can save them all but being ahead of the curve will certainly help.
X2!! Overselling is the main reason. That's what confuses me about Tim W. and his persistency.
- 19,667
I know. But he is the only one maintaining that of all the agents that use his system.
But he gets that premium commitment first. He will, and does, sell many $20/mo policies.
It's still amazing what he does but he is an aberation.
But he gets that premium commitment first. He will, and does, sell many $20/mo policies.
It's still amazing what he does but he is an aberation.
- 7,012
Maybe I oversold, but I asked her on numerous occasions if she could afford it. Her daughter was there with her and they both thought she needed more coverage. They both also said she could afford it and that if she said she could/would pay something she would.
But this was one of my 1st 5 policies ever sold. But this is also the only policy I have had fall off the books so far.
- 133
My number one reason is dealing with people that don't keep money in their acct. They go to the bank the day they get paid, take out all of their money and go around town and pay their bills in cash and money orders. Whatever's left, they keep in their pocket. When the carrier tries to draft the acct, there's no money there!
I try to stay in the $40 - $60 month range. That seems comfortable for most, as long as they keep money in their acct.!
- 5,309
Million dollar advice --
Whatever you do, make sure you follow up with all of your lapses or non-payments.
Most are not intentional, but accidental.
Whatever you do, make sure you follow up with all of your lapses or non-payments.
Most are not intentional, but accidental.
Biggest reason for cancellation / lapses is selling to 'Chemists'.
The definition of a 'Chemist' is someone who turns $money$ into $hit. The lower socio-economic echelon of society is full of "Chemists', unfortunately. The Wal-Mart society, the ones who run to the front door of the store on the 3rd of the month and eat beans and rice for 29 days following.
The definition of a 'Chemist' is someone who turns $money$ into $hit. The lower socio-economic echelon of society is full of "Chemists', unfortunately. The Wal-Mart society, the ones who run to the front door of the store on the 3rd of the month and eat beans and rice for 29 days following.
