“Why don’t more people feel good about selling life insurance?” wondered Joseph Jordan in an address here.
The senior vice president of individual business marketing for MetLife, New York, said he has been examining this question for the past three years. His conclusion: The fear of rejection felt by many life insurance producers inhibits their efforts to sell, with low productivity and low sales the inevitable results.
In a speech at the annual life insurance conference co-sponsored by LIMRA International, LOMA, the Society of Actuaries and the American Council of Life Insurers, Jordan urged the life insurance industry to redirect the sales interview–specifically, by encouraging emotional content that relates to motivation.
In the past 20 years, he said, the industry has “lost its way” by focusing primarily on products and information without motivating people to buy.
Many of today’s life sales presentations do not help clients address their emotions concerning protecting their loved ones in the event of an early death, he maintained.
For instance, many advisors no longer help clients connect the life insurance decision with feelings such as love for family and likely regret if they do not provide sufficiently for their survivors.
Many customers know bad things happen to people, he pointed out, but they do not think those things will happen to them, so they do not buy life insurance.
Advisors need to understand the situation from the client’s perspective and address that in the presentation, he said.
That message resonates with research findings from LIMRA International, said Robert Kerzner in an interview with National Underwriter. Kerzner is president and CEO of LIMRA.
Conducted last year, the study found that applying behavioral economics principles can improve how sales representatives sell.
Behavioral economics refers to identifying factors that influence financial decisions, Kerzner said. It recognizes that people do not always make rational decisions that maximize long-term worth or financial well-being, LIMRA said.
By contrast, he said, focus groups show that consumers evaluate more positively those sales interviews where behavioral economics principles appear. Focus groups also show that consumers recall the key messages of such presentations, and more often they are likely to buy after seeing such presentations than are consumers who view traditional presentations.
Traditional presentations have no real sales tracks, Kerzner stressed. “They have no proven words that the advisor uses over and over. Instead, the advisor goes through the analysis, is product-driven and doesn’t make sure the person really understood.”
Increasingly complex compliance requirements are partly to blame, he allowed, pointing out reps must now spend a lot of time meeting those requirements, so they have little time left for airing concerns and feelings.
Unfortunately, Kerzner said, the result is, people don’t buy the product, because they don’t understand and they don’t see the reason to have it.