InsuranceGuru
Expert
- 95
I'd like to test the waters so to speak on what I've heard a lot of people in the industry refer to as the "needs-based" approach to insurance sales. I sort of went off on a tangent in another thread and thought it could make for some decent discussion. I think the needs-based approach to selling insurance is problematic, but before I condemn it altogether I'd like to get some insight from others here.
Here's the problem as I see it. Unless the individual, family, or business has an established insurance background, they don't know exactly what they need from their insurance. I speak of health and life in this sense. Sure, they may have some idea of what they want to spend and what they are concerned about covering, but there's a vicious little paradox that comes with this. By the time someone realizes they "need" something covered, it's often too late to cover it. Why try to sell on a needs-based approach when there's no way for anyone to know what an individual, family, or business will actually "need."
We don't have time travel and we can't predict the future. The very idea that an insurance "need" can be met is fundamentally screwed up. In the realm of health insurance sales, I was told that identifying the concern, the very "need" of the client, was essentially how the client tells you "how to sell them." The whole needs-based approach, to me, is FUBAR.
Take a typical family of four. Both parents are 35 years old with two kids aged 7 and 9 respectively. What exactly is it that this family "needs"? Let's say they need health insurance. They have a reasonable budget, and they want the best coverage for that budget. If approaching this from a needs approach, you'll ask if they need doctors visits, prescription coverage, a low or high deductible, etc... but they probably don't even know what they need. They just want health insurance. They just want to be covered for everything possible.
From where I stand, it seems to me that people need to be covered with something that protects them from the five and six-figure medical bills that are bound to happen today. People need something that protects them if they become disabled, contract cancer or other dread diseases. They need something that protects them if they have an accident. They need something that pays their deductible and co-insurance if their assets are tied up in a business. They need life insurance with an accelerated benefits rider that pays if they're diagnosed with a terminal illness.
I can't really see anyone "needing" anything more or less than this, let alone anyone getting a real value out of paying for more than what this covers. And if people can't afford this, then they at least need some of it. I can't understand this approach to selling on a "needs" basis with people who have no background in health insurance, who don't even know what's out there or what they need.
Would someone care to comment on this, maybe shed some light on this "needs-based" approach to insurance? I'm really interested in the experienced health agents' thoughts on it, because I know there are probably some very good reasons for why some of them sell on this "needs" approach. I'd love to discuss it, debate it, or otherwise come to a better understanding.
Thanks!
-Shaun
Here's the problem as I see it. Unless the individual, family, or business has an established insurance background, they don't know exactly what they need from their insurance. I speak of health and life in this sense. Sure, they may have some idea of what they want to spend and what they are concerned about covering, but there's a vicious little paradox that comes with this. By the time someone realizes they "need" something covered, it's often too late to cover it. Why try to sell on a needs-based approach when there's no way for anyone to know what an individual, family, or business will actually "need."
We don't have time travel and we can't predict the future. The very idea that an insurance "need" can be met is fundamentally screwed up. In the realm of health insurance sales, I was told that identifying the concern, the very "need" of the client, was essentially how the client tells you "how to sell them." The whole needs-based approach, to me, is FUBAR.
Take a typical family of four. Both parents are 35 years old with two kids aged 7 and 9 respectively. What exactly is it that this family "needs"? Let's say they need health insurance. They have a reasonable budget, and they want the best coverage for that budget. If approaching this from a needs approach, you'll ask if they need doctors visits, prescription coverage, a low or high deductible, etc... but they probably don't even know what they need. They just want health insurance. They just want to be covered for everything possible.
From where I stand, it seems to me that people need to be covered with something that protects them from the five and six-figure medical bills that are bound to happen today. People need something that protects them if they become disabled, contract cancer or other dread diseases. They need something that protects them if they have an accident. They need something that pays their deductible and co-insurance if their assets are tied up in a business. They need life insurance with an accelerated benefits rider that pays if they're diagnosed with a terminal illness.
I can't really see anyone "needing" anything more or less than this, let alone anyone getting a real value out of paying for more than what this covers. And if people can't afford this, then they at least need some of it. I can't understand this approach to selling on a "needs" basis with people who have no background in health insurance, who don't even know what's out there or what they need.
Would someone care to comment on this, maybe shed some light on this "needs-based" approach to insurance? I'm really interested in the experienced health agents' thoughts on it, because I know there are probably some very good reasons for why some of them sell on this "needs" approach. I'd love to discuss it, debate it, or otherwise come to a better understanding.
Thanks!
-Shaun
