Dialing for dollars

[tippingpoint]

I can't speak about your manager's comments. All I know is the figures that I see every day, every week, every month, and every year from my team.

Everything has room for improvement but the numbers look something like this? Four $55 leads equals $220 lead cost. $60mo x 12 = $720 AP. $720 x 90% = $648. I don't know what SL advances let's assume 75%? $648 x 75% = $486 in the bank. $486 - $220 = $266 immediate profit. After that you get residuals and charge backs as incurred. So in reality you make $428 per policy minus future chargebacks. Is that about right?

 

[Telesales314]

Everything has room for improvement but the numbers look something like this? Four $55 leads equals $220 lead cost. $60mo x 12 = $720 AP. $720 x 90% = $648. I don't know what SL advances let's assume 75%? $648 x 75% = $486 in the bank. $486 - $220 = $266 immediate profit. After that you get residuals and charge backs as incurred. So in reality you make $428 per policy minus future chargebacks. Is that about right?

Not exactly, placement/persistency/chargebacks really need to be factored in because they are going to occur. and will have a significant impact. Commission is also 115-120% at a lot of places.

 

[Telesales314]

Everything has room for improvement but the numbers look something like this? Four $55 leads equals $220 lead cost. $60mo x 12 = $720 AP. $720 x 90% = $648. I don't know what SL advances let's assume 75%? $648 x 75% = $486 in the bank. $486 - $220 = $266 immediate profit. After that you get residuals and charge backs as incurred. So in reality you make $428 per policy minus future chargebacks. Is that about right?

I made an excel sheet but can't figure out how to attach it, so here is the basic formula.
For this example we will assume:
$900 AP
120% commission
75% placement
80% persistency
Lead Cost $55
Closing 20%

Total income per sale= AP x Commission rate x placement x persistency
Cost per sale = (1/Closing)*Lead cost

so for this example 900*1.2*.75*.8=$648 and the cost per sale is (1/.20)*55=$275

So the average policy sold would get you $373 in year 1.

Obviously you can't factor in EVERYTHING in a short formula (modified plans pay less), but hopefully this will help. You can mess around with all the variables based on the different leads/commissions/persistency that each IMO has.

 

[theinsuranceman]

We don't offer SL so my manager wouldn't be the subject matter expert, that why I asked you, since you mentioned the plan.

Many carriers level plans are at/below SL super-preferred rates already, so I just don't see the appeal of having one super super super low option to use as an example of 'we have affordable coverage' if not that many people can get it. I don't know the underwriting for Platinum, but looking at the 'ultimate preferred' application its highly restrictive and would rarely come into play with most clients.

Having the cheapest rates is not as important as you may think. If rates were that important all of the FE carriers in the top 50% of rates would have gone out of business, or lowered their rates. As it is none of them have lowered their rates to be competitive on rates nor gone out of business either.

On the other hand in the last 5 years it seems that a few carriers in the lower 50% of rates (the cheapest 50%) have raised rates and/or tightened their underwriting.

This right here tells us all we need to know about the importance of cheap rates or loose underwriting.

 

[theinsuranceman]

Thats lower that the $68, but I still would have to close 30% to break even comparatively

Even at the $68 you mention for Digital BGA's TV leads, in post #13 above, their agents close enough to still make a profit too. That right there is further proof that live TV transfers have a much higher closing %, enouigh to make a profit even at $68 per live TV transfer.

 

[theinsuranceman]

I was told a 15-20% close rate on these by my GA who sells them. I know your company pays in like a day or two which helps cashflow but how does it make sense to pay say $250 for a lead that pays say $600 AP x 90%=$540. A 75% advance puts $405 back in the bank giving you a $155 profit before charge backs and expenses. To me this doesn't add up. What am I missing other than improving on the 15-20% close rate that my GA stated is what his people are averaging?

Tell your manager to contact me and I'll send him my team's telesales training as I believe that will help him. If a field agent is closing 15% of their DM leads (3 out of 20) they're going to fail in this business also.

 

[Telesales314]

Having the cheapest rates is not as important as you may think. If rates were that important all of the FE carriers in the top 50% of rates would have gone out of business, or lowered their rates. As it is none of them have lowered their rates to be competitive on rates nor gone out of business either.

On the other hand in the last 5 years it seems that a few carriers in the lower 50% of rates (the cheapest 50%) have raised rates and/or tightened their underwriting.

This right here tells us all we need to know about the importance of cheap rates or loose underwriting.

Being cheapest isn't always everything, but I think being competitive overall is important.
I wasn't the one bragging about the cheap rates.
When JD criticized the one carrier setup, you stated 'what JD is not telling you is that Sr Life's Platinum Plan is one of the best rates in the country, and the UW is not all that strict.'

I am pointing out that having a plan like only helps those that can qualify. If your top tier plans like Platinum and ultra preferred are competitive, then great, but that doesnt really help all the people on SL preferred/standard/modified/GI plans that are extremely uncompetitive compared to plans they could've qualified for elsewhere with average carriers.

If you could show or link the app/rates for the Platinum we could see for sure. I have looked at the ultimate preferred/super preferred/etc apps, but can't seem to find the Platinum app anywhere.

 

[jdeasy]

I don't generate the leads, SL does. But if one of my agents told me they heard that I would replace that lead out of my own pocket. But it just doesn't happen. Do you have any/much experience working live TV transfers?

Doesn't matter if I have used them. I don't have to be a veterinarian to recognize a horse's ass either.

But that's not the question. You pimp the leads and then if there's a problem you claim you have nothing to do with it.

If I were making those claims and an agent told me that a prospect said that, I would simply replace the lead. Your alligator mouth is making claims that your hummingbird ass can't back up.

 

[Telesales314]

Even at the $68 you mention for Digital BGA's TV leads, in post #13 above, their agents close enough to still make a profit too. That right there is further proof that live TV transfers have a much higher closing %, enouigh to make a profit even at $68 per live TV transfer.

I never stated they don't make a profit, I know they do. OP was talking about what to expect income wise from each individual sale, and someone had told him 15-20% closing.

I was pointing out that the 15-20% closing depends on the scenario.
15% closing on live transfers=Pretty Good
15% closing on TV leads that are twice the price=not good. (and you seem to agree based on your posts)

I am by no means against TV leads, I know they work and I know a lot of people have success with them. It just doesn't make sense for me personally given my success with the cheaper live transfers.

 

[WinoBlues]

Your alligator mouth is making claims that your hummingbird ass can't back up.

My go too is -

'Don't let your eagle beak overload your humming bird ass'
Then the fight started.