How do you cultivate profitable and long-term relationships with attorneys and CPAs? What misperceptions do these practitioners have about insurance and financial advisors? Why aren’t more advisors successful in their efforts to establish professional connections?
Answers to these and other questions were the focus of a session during the Society of Financial Service Professionals’ annual Forum, held here recently, and presented by Jonathan Mintz, executive director of Advisors Forum, Benton, Ore., and co-executive director of Wealth Counsel, a sister firm based in Madison, Wis.
“Among the labels that financial professionals most commonly apply to attorneys and CPAs are ‘deal-killer,’” said Mintz. “All too often, these other advisors will tell the client, ‘you don’t need life insurance.’ In my experience, that’s because they don’t understand the value of the products. And given the fear of malpractice, if you don’t understand something, the safest course is to say “no” [to recommending insurance].”
Often, too, Mintz added, the relationship among practitioners gets off to a rocky start because of preconceived notions about the motivations of the financial professional. Among them: that the advisor is a “product-pusher” who is only interested in selling. Attorneys and CPAs also tend to look for confirmation of their perceptions in the advisor’s actions.
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This disconnect can lead to an airing of disagreements between advisors in client meetings. The result, particularly, in cases where the client has a long-standing relationship with the attorney or CPA, is for the client to side with the position of the non-financial professional, precluding the financial advisor’s recommendation.
To avoid such conflicts, said Mintz, the financial professional should ask the client for permission to meet with tax and legal counsel early in the planning process. The advisor might inquire during such get-togethers about planning strategies with which the other experts are acquainted and are prepared to consider; and, if they’re averse to using life insurance or other financial products, then the advisor should press them to propose a suitable alternative.
Where planning solutions are not a source of friction, the referral-generation capability of the opposing advisor often is, added Mintz. And the reason comes back to misperceptions: an expectation among many financial professionals that an allied attorney or CPA will reciprocate in kind when given referrals.
“What I often hear is: ‘I referred 10 clients to this lawyer, and I didn’t see a single prospect in return,’” says Mintz. “The problem is the [financial] advisor didn’t ask the other practitioner how he gets business. Advisors need to set expectations up-front. But that doesn’t necessarily mean exchanging referrals. An attorney or CPA can generate significant value in other ways, for example, by jointly conducting seminars with the advisor.”