Editor’s note: This post was originally published on 11/22/16 and has been updated for accuracy and comprehension.
“Live, die or quit.”
Years ago, these three words were joined together to exemplify the benefits of cash value life insurance for those being trained as career life insurance producers.
In front of a client, these three words outlined future events in which life insurance could be beneficial:
- #1: Premature death resulting in the insured’s survivors being paid a death benefit.
- #2: The insured outlived his retirement benefits and needed additional cash to live on.
- #3: The insured unexpectedly needed money during the life of the policy or if they discontinued the policy.
Since “training” life insurance producers has almost become a thing of the past, educating and selling the client on these possible benefits of a life insurance policy has become almost non-existent.
In the days when “career agents” were trained on a widespread basis, newer agents were being trained to sell life insurance as opposed to simply presenting it.
Selling life insurance to the cash-strapped consumer
Today, more and more people with insurance licenses have become order takers as opposed to “salespeople.”
Too often, when presented with a life insurance prospect, insurance producers are simply listening (somewhat) to what the customer thinks they want and then filling the order.
In some cases, this may work out in the end.
However, in most cases, the client will remain uninformed regarding possible benefits to them that go far beyond a death benefit.
Check out these enlightening statistics:
- A recent study found that close to half of those who earn from $100,000 to $149,000 a year have less than $1,000 in their saving accounts and some 18% of them have no savings at all.
- In 2016, the average family earning a middle-class income would have a hard time coming up with $400 for an emergency.
So how do you get the “Live, die or quit” strategy to help people avoid what is obviously occurring in their financial lives?
The answer is easy, although the process might not be.
When someone is considering life insurance, sell them what they need (a death benefit and forced savings) and not what they want.
It’s not rocket science to figure out that the client will have their eye on term insurance because of the low cost.
Historically, the objection on the part of the client is that they can buy term insurance and “invest” the difference between the cost of the term and the cost of the cash value coverage.
Unfortunately for term buyers, they never invest the difference in premium. (If you – or they – need proof, see the stats listed above.)
The other traditional objection is that they simply cannot afford the more expensive coverage.
They may be right – but not for the reason they might think.
It seems that consumers can’t afford other options because most people are addicted to spending.
Half of all Americans admit to spending more money than they make each month.
How can they save money that they have already spent?
Let’s face it: Most of the people you’ll be talking with will not force themselves to save money and are probably spending more than they make – or at least what they make.
As a salesperson, it is your job to sell consumers on the realities of their situation and convince them that cash value life insurance can be at least one solution to a savings plan that will work.
Even though your client might not like what it costs, they deserve to be advised by a salesperson and not just appeased by an “order-taker.”
How do you combat financial objections to a more expensive policy?