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Tips on getting the life insurance wake-up call right

by: Mortgage Solutions
  • 06/10/2011
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Tips on getting the life insurance wake-up call right
Aviva has revealed its latest TV campaign attempting to boost consumers’ awareness of income protection and critical illness cover.

What tactics can brokers use to break client apathy?

Giving their thoughts in this week’s Market Watch are:

Kevin Paterson, sales and marketing director at Assurant Intermediary

Andy Frankish, managing director of Mortgage Talk

Ian Smart, head of product development and technical support at Bright Grey

Kevin Paterson, sales and marketing director at Assurant Intermediary

The Aviva ads have successfully raised awareness about income protection and that has got to be a good thing.

Whilst the Aviva advertisements raise awareness of the product, brokers need to make sure they are well placed to benefit from the increased exposure.

When the advertisements stop, how can brokers continue to break client apathy towards income protection (IP)?

From 1 October, all ASU providers must provide upon request their claims ratios showing claims paid during the preceding business year. Providers will have to make this information available three months after the end of their business year.

Brokers can use this information to help build credibility for the product amongst their clients.

This increased transparency, combined with the move to underwriting at the point of sale, should help restore confidence in the value of IP.

Brokers also need to be smarter about where they spend their marketing budgets, making use of the (often free) marketing support services that intermediary-friendly general insurance distributors have available and utilizing their existing client bank.

Sending regular, relevant, direct communications to clients, with product information or tips, will ensure their brand is top of mind when clients look at buying insurance.

The important thing to remember with any marketing campaign is to make the message relevant to the audience.

Like Aviva, brokers should make use of real life case studies and testimonials that clients can empathise with. Draw attention to the latest stats on unemployment and the current situation on state benefits.

Too many consumers think they will be able to fall back on the government to maintain their lifestyles if they lose their job or cannot work, but the reality often surprises them.

Few brokers are likely to have a marketing budget to match that of providers like Aviva.

However, it doesn’t have to cost a fortune to develop a marketing campaign that will deliver measurable results and make a significant impact on your customers.

Andy Frankish, managing director of Mortgage Talk

When it comes to selling protection, the single most important thing to remember is to make sure you know your customer.

There are no secrets, no tricks, just thorough fact finding and treating your customer as what they are, an individual.

One of the main problems with selling protection is that it veers away from the “dream” phase of the process, helping your client secure a home. As a result advisers can often be apprehensive when it comes to addressing the harsh realities of life.

However, the job we do as a mortgage intermediary means that effectively we are helping our clients to put a large financial debt on their shoulders.

The ugly truth is that bad things happen and we have a responsibility to ensure that our clients are properly prepared for any eventuality should something go wrong.

Ultimately, if we don’t do that, we are not doing our job properly.

One of the best ways to help clients understand what cover they need and why is to use real life situations to give tangibility to the products you are discussing.

Don’t forget that in the first instance you are selling a concept, not a particular product, so present scenarios where certain types of cover could come to your client’s aid.

For this to be an effective technique though, you must tailor your approach for each client.

Find out what is important to them and help them understand how the different types of cover apply to their own life.

It is not a particularly pleasant conversation to have, but addressing the harsh realities early on can help your clients to protect themselves and their families in the long term.

Ian Smart, head of product development and technical support at Bright Grey

The two biggest barriers for critical illness and income protection are consumers’ resolute defiance that it could ever happen to them and the perceived expense of the cover.

Often, one of the most persuasive factors to taking out a policy is when a client experiences someone at close quarters, either a friend, colleague or someone in the family, dealing with an illness.

That’s when it really hits home.

But how does an adviser recreate this scenario? Well several companies, Bright Grey included, have real life case studies available on their websites.

These can be used to illustrate the benefits of taking out protection products from people who have claimed. Advisers can easily use these or even get examples from their own client bank to overcome the ‘it’ll never happen to me’ objections.

People that have claimed and had a positive experience in the process can be strong advocates for your business, showing you really are interested in your clients’ long-term well-being.

To overcome the cost objection, an effective method is to compare the cost to other things the client may spend money on regularly without even thinking about it. 

Simply asking how much they spend each week on such things as coffees, magazines, takeaways and trips to the cinema will help put the cost of a protection plan into perspective.

If cost is still an issue, a small amount of cover, just enough to get through the first few months of a serious illness, is all that is needed to get clients into the habit of protecting themselves with the possibility of increasing the cover at a later date.

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