How To Sell Annuities Unintentionally In A Down Market

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I was asked recently how I was selling so many annuities in a down market. Frankly, I am not trying to sell a lot of annuities–or a lot of any other products for that matter–in any market. That does not make sense.

Certainly, one of our goals is to sell as many products as our clients need, or place as many assets under management as possible. However, I feel we do much more than represent a favorite mutual fund or insurance product to our valued clients. We sell serviceand the sales follow.

There is a core set of disciplines that makes a financial practice successful. These disciplines create a formula that results in a lot of products sold and a great many assets placed under management. They are founded on three essential values: service, education and advice.

It also helps to develop a culture in the firm that places all associates and employees on the same page.

There is an old clich?: “Its not what you know but who you know.” I like to take that to another level: “Its not who you know but how you take care of who you knowdo it so well they become an advocate for your business.” Here are some ideas.

Service. If we cannot take care of our clients, they should not do business with us.

In short, be committed to taking care of clients from start to finish on any planning services provided. That means going above and beyond normal responsibilities to make clients feel special.

Whats important to an individual, family or small business owner? Is it to feel that you, their trusted advisor, are a part of their team of decision-makers?

Successful people have a team behind them, helping them make critical decisions or coaching them to make their lives better. Financial advisors are often the first members of their professional team, and we make sure they realize how valued they really are. By actually returning phone calls and bringing clients in for periodic reviews, we cement this relationship.

Education. The financial advisor does not expect clients to know what we know. However, it is essential for us to expect them to understand enough about what we are presenting so they can make good decisions for themselves.

What is the most frustrating aspect of our business? That people do not understand what to ask or what the answer means once it is offered.

We spend a great deal of time with clients, educating them on how financial products work and what their investing and insurance options are. What is a stock, bond or mutual fund? How do insurance products really work? This process takes the most time, but the results are worth it. Better educated clients not only are comfortable with their decisions, but also not distracted by other peoples friendly suggestions.

Advice: Clients come to financial advisors because they are looking for a solution to their financial issues.

Imagine placing someone on your shoulders and carrying them through the rest of their lives. Heavy, isnt it? Yet in a sense, this is what we do for our clients when we make a commitment to help. We are committed to using our experience and education to help our clients meet their goals.

But, if we are going to take on that responsibility, we had better know what were talking about and back that up by giving our clients the advice they need to put their financial plans into action.

Having said this, we come to the point where we have to ask ourselves how we are going to get paid when we are offering so much time to our clients–time that does not automatically lead to a paycheck.

It comes down to referrals. The firm creates a culture that builds pride among those in the client base. The clients become so proud of doing business with us that they talk about us often. The best compliment you can receive from the prospect who, after being introduced, says, “So youre the one who has been so helpful to my friend or family member!”

An added benefit of this attention to culture is that every person in the firm is on the same page. The associates and assistants understand the ultimate goal of the firm, and this creates an attitude of success. That understanding is so deep that any member of the team can easily handle essential processes, and everyone feels he or she can accomplish personal goals as well.

To me, that is what building a business is all about. And if you do it well, yes, it leads to selling a lot of products and placing a large volume of assets under management.

To answer the original question about how I sell so many annuities in a down market, I would have to say that, in general, I spend so much time educating that the solution often presents itself to the client. I have placed a lot of assets in tax-deferred vehicles because it made sense.

Earlier this year, I was able to capitalize on higher fixed interest rates. Finding a good return in todays market is a challenge and, with competitive rates and the tax advantages, annuities became a good solution with many benefits.

, head of operations for the New Mexico offices of Olympus Financial Advisors, Albuquerque, N.M. He is a registered representative with Carillon Investments Inc., and The Union Central Life Insurance Company, Cincinnati, Ohio.


Reproduced from National Underwriter Life & Health/Financial Services Edition, October 3, 2003. Copyright 2003 by The National Underwriter Company in the serial publication. All rights reserved.Copyright in this article as an independent work may be held by the author.