His smartphone alert reminded the advisor that it was time to make the call. He had done a search on five-year levelterm policies that were in their fourth year and this was one of them, a 69-year-old woman with $2 million of coverage.
By converting in the fourth year, the new premium would be $46,932. If she waited and went with the standard product, the premium would jump to a little over $61,000. When they talked, she immediately saw the advantages of doing the conversion now: lower cost and no additional underwriting.
This producer recognizes that to grow his revenue, he must look for new clients and, at the same time, mine his book of business for sales opportunities from existing clients.
Before you start rolling your eyes, see where this is not going. Every producer has been told to go back to existing clients for referrals. It’s a good idea, but it doesn’t work well for many producers, and that’s why it’s good to look in a different direction.
Best of all, everything a producer needs is readily available from the advisor’s own client files, insurance company records, and an MGA. While prospecting for new clients is essential, producers are their own best resource for growing their revenue. Here are ideas for going about it:
1. Review smoker policies to see if clients have stopped smoking. Since so many people have given up smoking, there’s a good chance that some of your clients have quit.
Start by contacting them by letter, email, text, or phone indicating you arereviewing client life insurance policies. If there are clients who have quit, look for a new and better policy or at least try to change the existing policy to non-smoker. This is good news for the clients and can free up dollars for a new policy or even a different product. Once you have a beneficial solution, get back to the clients with the good news.
2. Review your impaired risk cases, both placed and not placed. As you know, underwriting is changing constantly, so that it can be far more forgiving than in the past, which is another reason for reviewing your client files to see if there are opportunities to either update or replace an existing policy.
Prostate cancer is a good example in which a high PSA can qualify for a great rate that would have been rated or a decline in the past. There have been underwriting changes with diabetes, sleep apnea, weight loss, blood pressure, cardiac conditions, and any policy with a flat extra premium.
There are also underwriting changes when it comes to family history. In the past, there could be an issue with an offspring of a parent who died before 60 years of age from cancer or a heart condition; now, this may not matter.
3. Monitor and mine clients’ term life policies. Among missed opportunities, term life policies rank near the top. Because advisors look for motivated clients, here are several possibilities for those with term policies.
Make it a practice to contact all level term life policyholders during the last two years for conversion to a permanent product. Lifestyles and health conditions change. Since term policies have an expiration date, this creates an opportunity for a client to leverage the investment in the existing policy for new, more appropriate benefits.
An infrequently used scenario is to sell your term instead of letting it lapse, if it’s convertible, it’s possible that there is an insurance company that will buy it, pay the client and they pay the premium as the beneficiary. It’s another way for advisors to help a client and open the door for additional business.
Also, carriers report that many term life policies remain in force after their level term period ends. The premium jumps to a much higher amount; yet, surprisingly, people continue to have payments withdrawnfrom their bank account. Showing them how much the premium has risen and will continue to rise provides an opportunity to reestablish the need and offer an option for another level term or permanent product.
• Care to comment on the ideas shared, or add your own? Please visit this new thread: 6 ideas for mining files to drum up business
4. Look for multi-year guaranteed annuities that are approaching the end of theirguaranteed period. The interest rate on these annuities is locked in for a specific period, generally, 3, 5, 7 or 10 years. At the end a client usually has 30 days to do something with the annuity. If they don’t, the insurance company typically renews the annuity for the same period and at the current rate, and, at the same time, the surrender period is reset to start again. This is a window of opportunity to shop the annuity for a better rate, which, if taken, is a new sale with new commissions. No brainer here.
5. Review informals to determine if the client situation has changed. In this pre-application space, the case’s medical records would have been shopped with carriers to determine the best offer. Many times this is done when an impaired risk is involved that could cause a rating or decline.
In about 3-out-of 10 situations this results in a sale, which is good. By re-looking at the cases that didn’t receive favorable results, advisors can find sales because the underwriting may be more lenient or because time has passed and underwriters can see if the condition is stable or has improved. Both are favorable for the insured.
6. Keep clients informed. Even though they’re clients, chances are they’re apprehensive when advisors ask for an appointment. “What do you want to talk about?” some ask, fearing that it will be a sales call, which may be one reason why producers often avoid follow up contacts.
How can a producer diffuse client reticence and have non-threatening interactions with clients? Besides what was mentioned, here are a several conversation-starters that work because they bring value to clients and show that you are interested in them:
• Insurance company merger or acquisition.Clients expect to be kept informed today. So, taking time to let them know of a change with their company is an opportunity to find out what’s going on in their lives.
• Attractive premium rate changes. Letting a client know they can have more coverage for a lower premium, and possibly other benefits, is an easy way to begin a conversation.
• New, favorable life products. Matching what you know about client situations with new products is another opportunity for arranging an informative meeting.
• Riders. As new riders come available to meet specific situations, it’s easy to show clients how they can benefit from fine-tuning a policy. Long-term care riders can be of particular interest. This area is advancing quickly. One carrier announced that 40% of all permanent applications sold last year had been issued with its long-term care rider. Make no mistake, 40% is a lot, and an indication that consumers are thinking seriously about long-term care.
Leads don’t fall in a producer’s lap, but they’re nearby — in the electronic files. All the information needed is here. Setting up a monthly alert to review five or 10 files is the way to start. What you’re looking for is staring at you, waiting for you to grab it.
Anthony O’Kussick, CLU, is Director of Internal Sales Support & Operations at First American Insurance Underwriters, Inc., of Needham, Mass., a wholesale life insurance, annuities, long-term care and disability income agency. He began his life insurance career in 1993, and resides in Brookline, Mass. Contact him at 800-444-8715 or [email protected].
• Care to comment on the ideas shared, or add your own? Please visit this new thread: 6 ideas for mining files to drum up business
