The customer isn’t always right

“When a client puts an advisor into a difficult ethical position, its the advisor’s duty to do the right thing, even if they potentially lose the client,” Kestler says. “The advisor needs to explain to his/her client that the reason they hopefully chose to work with him/her, is due to his/her reputation. Reputation is not only important in local communities but is also important with the carriers an advisor chooses to work with. A client asking an advisor to compromise his/her ethics needs to understand they are asking the advisor to risk his/her future prosperity.”

Consistently making decisions to “do the right thing” is the mark of the ethical and compliant advisor, and can help that advisor gain a real edge on the competition by actively promoting themselves as a “safe and ethical” choice in their community.

“It’s kind of a weird dichotomy,” Kelly says, “because gaining a competitive edge by doing the right thing seems kind of silly. But unfortunately in the financial services industry, it does.”

Kelly subscribes to the concept that an insurance agent needs to be “known, liked and trusted” before a prospect will buy from them.

“I think that last one being trust, as an insurance producer or financial advisor in the industry, that’s ultimately what you’re going to be judged upon. People are going to first have to know and like you, and then you have the conversation, but to actually write the check or continue the relationship, there’s got to be that level of trust,” Kelly says.

Kestler points out it isn’t easy to become known for solid ethics. “Relative to someone with good ethics, word of someone who is known for having bad ethics travels at light speed,” Kestler says.

But that doesn’t mean it can’t be done.

“As a child I was always curious to why McDonald’s posted the number of hamburgers served on their signs. It wasn’t until later in life when I finally figured it out. It was a subliminal message. They are basically saying 1 billion people choose to eat here and they didn’t die,” Kestler says. “I’m not suggesting a financial advisor should post how many clients they have on their signs, but I am suggesting they should position themselves as the ‘safe and ethical’ choice in their surrounding community.”

Kelly adds that in his experience, there are a lot of agents that don’t always do things the right way and act in the best interest of the client. He says that by doing right by the client versus doing the selfish thing (ie: pushing a higher-commission product) or the quickest way to put money in the bank, an advisor – with the help of word of mouth, referrals, and even social media – “can become known as, ‘Hey, this is a guy you can trust if you go to him. Here’s what he did for me.’”

An advisor who displays honor, integrity and does the right thing puts himself in a prime position to generate this type reputation in his community.