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Regulation and Compliance > Federal Regulation

No-worry selling — solicit straight to win big

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Should solicitation “tricksters” be named to the Sales Hall of Shame? Methinks they should because advisors who play games in order to gain appointments hurt their prospective customers, while smearing the good name of competitors who sell straight. And they’re not doing themselves any favors, either.

Adopting a “no-worries” solicitation style makes infinitely more business sense. It means you’ll have fewer regulatory complaints or client lawsuits stemming from dashed initial expectations. It also prevents E&O insurance claims, which can cause problems later if you need to apply for a new coverage. And you literally will sleep easier at night, knowing you scored appointments on the basis of your legitimate selling skills, rather than your ability to weasel past people’s defenses.  

Problem is, many advisors fail to make the connection between a “no-worry” solicitation style now and unhappy, litigious clients later. Perhaps they think it’s OK to trick their way into a meeting as long as they come clean during the first meeting. Wrong!

In fact, you only have one shot to make an ethical impression. When prospects agree to meet with you, but then realize within minutes that you lied or hid a material fact in order to get the interview, it’s game over. Nothing you can say or do from this point forward will convince them to trust you. Now, they may still buy from you, but they will always have nagging doubts about your integrity, which will limit cross sales and referrals.

So what does a no-worry solicitation style look like? Not surprisingly it depends on both ethical values and compliant behaviors. Ethical values are implicit in activities such as:

  • Avoiding fear-based appeals in your initial approach to prospects.
  • Never hiding any material fact about who you are or what you’re selling.
  • Never exaggerating the features and benefits of a product in a telemarketing call or direct mailer.

Compliance with relevant state and federal regulations is equally important. Although there are too many compliance rules relating to solicitation to discuss fully in this space, here are a few key points to consider. As always, check with your compliance officer for complete details.

1. Don’t lure a prospect to an interview by misrepresenting what you sell or who you are, either in print or over the phone.

2. Make sure your telemarketing complies with the Telephone Consumer Protection Act and the Federal Trade Commission’s Do Not Call rules.

3. Make sure your advertising materials are accurate and truthful, fair and balanced, and approved by your FMO, broker-dealer or RIA. 

4. If you do e-mail marketing, give recipients the opportunity to opt out of future mailings, while making clear that your message is an advertisement. Also never use false or misleading e-mail headers.

5. If you use lead-generation firms, make sure they don’t use deceptive methods in order to secure prospect leads. Watch for false statements on direct mailers regarding government programs and/or sponsorship.

6. If you conduct seminars, disclose your role as an insurance agent and your company affiliation(s), always identify what you’re selling, and do not offer “free” reports or analyses with an exaggerated list price when no one ever pays that price.

Put ethical values and compliance prowess together and what do you get when it comes to solicitation? Better closing ratios, less friction in the sales process, higher persistency and account loyalty, and a higher income level. What’s not to like? 

In short, when you score appointments fairly and legitimately, you give yourself a powerful leg up in terms of your ability to close sales and to build a successful — and sustainable — business. For the life of me, I can’t see how anyone would prefer to play tricks instead. 

See also:

No-worry selling — the sleep aid for sales superstars

Following the yin and yang of ethics and compliance

Ethical sales practices are good for more than your conscience