Med Supp Vs Final Expense

[tm8340]

I am just starting out(I will be an independent agent) and had planned on focusing on either final expense or med supp. Both involve cold calling and the senior market. I know lots of opinions exist on this next question, but as a newbie in the field, I am trying to decide whether to pursue either med supp or final expense leads. I am leaning towards med supp only, but was wondering what some grizzled vets in the biz have to say looking back in hindsight, if they were to choose one path NOW, what would it be? Thanks for the input, Tom I will f2f or cold call or both.

 

[Newby]

I am just starting out(I will be an independent agent) and had planned on focusing on either final expense or med supp. Both involve cold calling and the senior market. I know lots of opinions exist on this next question, but as a newbie in the field, I am trying to decide whether to pursue either med supp or final expense leads. I am leaning towards med supp only, but was wondering what some grizzled vets in the biz have to say looking back in hindsight, if they were to choose one path NOW, what would it be? Thanks for the input, Tom I will f2f or cold call or both.

If you need to make money faster FE is the way to go. But if you have some cushion and can take a bit longer to build up a financial flow there are some great reasons to lead with Med Sups and cross sell the FE.

First you want to make sure you are in a good state for Med Sups. Florida for example is not. It's dominated by one company and has a lot of MAPD. So selling Sups is brutal there.

The advantage of leading with Sups is the lead cost is way less. Our agents pay $20 set price for Med Sup leads that have age filters of 65-79 and income filters of $25,000 +. That lead with those filters for FE would be in the $30 range. So you can buy 30 Med Sup leads for the price of 20.

Now the bad news. With Med Sup leads you can not filter out people with Medicare Advantage. It can't be done. People with zero premium will still be mailing in your card to get a lower premium. (Who knows why?)

But every lead is always an opportunity. You still want to get in front of every one of your leads. There is opportunity in every home. You will sell FE, Med Sups, Med Advantage, Indeminity plans, Cancer Plans, and yes even annuities off of Med Sup leads. The key is lead with one thing. Get real good at it. Add the next obvious thing. And keep going.

If you are going this direction I would start with Med Sups, add the FE cross sell first THEN Med Advantage. There is a lot of money to be made with Med Advantage but it will mess you up in the beginning. You need to learn how to sell premium.

Feel free to give me a call any time. My strong point in the field has always been the cross sale. When I placed a product in the house I usually placed multiple products. And that gets you a huge increase in persistency. It's not difficult. I always found it to be easier than placing a new fresh sale with someone that I haven't met before.

 

[jdeasy]

I am just starting out(I will be an independent agent) and had planned on focusing on either final expense or med supp. Both involve cold calling and the senior market. I know lots of opinions exist on this next question, but as a newbie in the field, I am trying to decide whether to pursue either med supp or final expense leads. I am leaning towards med supp only, but was wondering what some grizzled vets in the biz have to say looking back in hindsight, if they were to choose one path NOW, what would it be? Thanks for the input, Tom I will f2f or cold call or both.

You can take the shotgun approach and try to kill everything. The good thing about going that way is that you can wash out of the business real fast and then move to something else.

Or you can specialize and possibly have a long and successful career.

Both markets you mentioned are great markets but they are completely different markets.

If you focus on FE you can add in other sales once you become an expert at FE. But once you become an expert on FE you probably won't want to add in anything.

Med sups while focusing on FE are a rarity. The vast majority of the market are Medicare advantage people. Not med sups. Most are getting extra help if not full Medicaid. If you want to involved with MA then that is a natural add on to FE. Still, become an expert first. Don't go out as a new agent with the idea of cross selling. Unless you do want to fail fast?

Med sups are a steeper learning curve and a completely different demographic than FE. It's a very easy cross sell for FE though. Again, that should come later after you have become an expert on med sups.


Leads a re available for both. There's no cold calling for either unless you just want to cold call.

Once you have decided which field then talk to producers in your chosen field.

Do not give a marketer 5 minutes of your time about learning to be a producer. There's a reason they are sitting at that desk recruiting you.

 

[grod]

You can take the shotgun approach and try to kill everything. The good thing about going that way is that you can wash out of the business real fast and then move to something else.

Or you can specialize and possibly have a long and successful career.

Both markets you mentioned are great markets but they are completely different markets.

If you focus on FE you can add in other sales once you become an expert at FE. But once you become an expert on FE you probably won't want to add in anything.

Med sups while focusing on FE are a rarity. The vast majority of the market are Medicare advantage people. Not med sups. Most are getting extra help if not full Medicaid. If you want to involved with MA then that is a natural add on to FE. Still, become an expert first. Don't go out as a new agent with the idea of cross selling. Unless you do want to fail fast?

Med sups are a steeper learning curve and a completely different demographic than FE. It's a very easy cross sell for FE though. Again, that should come later after you have become an expert on med sups.


Leads a re available for both. There's no cold calling for either unless you just want to cold call.

Once you have decided which field then talk to producers in your chosen field.

Do not give a marketer 5 minutes of your time about learning to be a producer. There's a reason they are sitting at that desk recruiting you.

I love it....20 characters

 

[TMerwin]

Med Supp generally has better persistency with a higher renewal comp, whereas your FE commissions are front loaded with a much lower renewal. That lower persistency can also create chargeback problems with FE that you generally won't run into with med supp. As mentioned above, FE cross markets well with med supp, but not as well the other way around. From what agents tell me, most get better / more responses on a med supp lead campaign than FE campaign too.

Contrary to above though, you can indeed cold call for FE and med supp so long as you're not in Ohio. To my knowledge Ohio is the only state that has completely nixed cold calling to seniors. You can't cold call for med advantage in any state, but again FE and med supp you can... outside of Ohio. then it's just a matter or choosing to self-dial or use a predictive dialer.

Use med supp to build your long term renewals and cross market FE to stuff your pockets first year. Extra commissions earned in FE can help you beef up your med supp campaigns to keep your pipeline full, and once you're comfortable, every time you close a med supp sale, ask them about FE if you haven't already.

Best of luck!

 

[jdeasy]

Med Supp generally has better persistency with a higher renewal comp, whereas your FE commissions are front loaded with a much lower renewal. That lower persistency can also create chargeback problems with FE that you generally won't run into with med supp. As mentioned above, FE cross markets well with med supp, but not as well the other way around. From what agents tell me, most get better / more responses on a med supp lead campaign than FE campaign too.

Contrary to above though, you can indeed cold call for FE and med supp so long as you're not in Ohio. To my knowledge Ohio is the only state that has completely nixed cold calling to seniors. You can't cold call for med advantage in any state, but again FE and med supp you can... outside of Ohio. then it's just a matter or choosing to self-dial or use a predictive dialer.

Use med supp to build your long term renewals and cross market FE to stuff your pockets first year. Extra commissions earned in FE can help you beef up your med supp campaigns to keep your pipeline full, and once you're comfortable, every time you close a med supp sale, ask them about FE if you haven't already.

Best of luck!

I take you are not a producer? And no one told him he couldn't cold call. Just that it's not a requirement as he indicated. There's no reason to cold call for either unless you just want to.

 

[TMerwin]

I take you are not a producer? And no one told him he couldn't cold call. Just that it's not a requirement as he indicated. There's no reason to cold call for either unless you just want to.

My apologies.. I misread your statement as though you were saying cold calling wasn't allowed...

There's no cold calling for either unless you just want to cold call.

 

[Glen Shelton]

I am just starting out(I will be an independent agent) and had planned on focusing on either final expense or med supp. Both involve cold calling and the senior market. I know lots of opinions exist on this next question, but as a newbie in the field, I am trying to decide whether to pursue either med supp or final expense leads. I am leaning towards med supp only, but was wondering what some grizzled vets in the biz have to say looking back in hindsight, if they were to choose one path NOW, what would it be? Thanks for the input, Tom I will f2f or cold call or both.

Hi tm8340,

Every producer will have their own preference on which line of insurance they prefer to pursue. If you are brand new the insurance business, Final Expense will pay you more upfront but Medicare Supplements will pay you more on the renewal trail ...

If you are looking for more information comparing these two, I actually wrote an article comparing them last year on my blog: The Differences Between Final Expense and Medicare Supplements - Lead Heroes

Either way, I am a big fan of the senior insurance market and I think you are headed in the right direction!