Money is and will also be a very sensitive issue. And so it is with the insurance sales process as well. For example a prospect with a budget constraint may not openly tell you so and the figures provided by him in the personal financial review (PFR) may not always be a true reflection of what he actually earns. At times, a low income person may inflate his own earnings to look and feel better about himself and someone who makes a lot may try to under declare in the PFR, for whatever personal reason he may have.
So how then does one handle the budget issue?
First and foremost, never oversell. This almost always results in an early lapse which is a lose-lose situation for all concerned. You, the agent, will lose out in the long run as poor quality sales will ultimately be reflected in your persistency score.
Your client too will stand to lose as early lapses often results in financial losses for them. So if after analyzing the PFR, you realized that the client has got adequate cover or if he really cannot afford another policy, don’t push him; move on to the next prospect but do so nicely, offering to do another review further down the road.
Look Out for Inconsistencies
Observe his lifestyle, his attitude towards spending money and listen actively to what he tells you. Is there a inconsistency between what he does versus what he says?
For example, you may have a prospect who was previously very extravagant (you see from his lifestyle choices) but from the conversion, you sense that he is very tight on his spendings of late. Perhaps he has met with a recent cash flow problem; or it could be that his business is not doing as well as before?
If it is indeed true that he is having recent financial difficulties, there is a fair chance that due to his pride and ego, he may not reveal everything in the PFR. In times like these, further probing is always necessary.
Granted, it is not always easy to sense such inconsistencies; it may take a fair bit of experience. But if you have a genuine interest for others and always made it a habit to listen actively, beyond what is being said verbally, you will be surprised at how sensitive you can become to such signals your prospect gives out.
How does an Agent Probe Further?
Here is how I would probe when faced with such situations. I would first try a test close to sense the client’s reaction; I will look out for signs of hesitation to which I will respond with the following script…
Agent: Mr Prospect, I can some sense that you are not ready to go ahead today with what we discussed. I am just curious, is it because any part of my presentation is unclear?
Client: No, everything is very well presented.
Agent: Then could it be due to my recommendation not being up to your expectations?
Client: Not really; your recommendations are fine.
Agent : Then don’t tell me it is due to my company or me?
Client: Definitely not.
Agent: Phew! For a moment I thought I could be the problem. (Pause for a short while, smile to lighten the atmosphere a little and then continue in a more serious but genuinely empathetic tone). Mr Prospect, in most situations, when it is not due to my presentation, recommendation, company or myself, it is usually because of the money. Is that what we are dealing with here?
Prospect: Yeah, I guess I am on a tight budget lately.
For the above to work, the tone of voice is often more important than what is verbally said. The client must feel completely safe to reveal his money concerns to you before he will actually do so; hence agents who are better at empathizing with others are more likely to score better using this.
Personally, I use it because it is tactful and when asked with genuine care and concern, can sometimes draw the client out of his shell.
How Should You Proceed Once You Confirm Money is The Issue?
Once the client is willing to share that money is the issue, you will usually be able to find out the extend of the problem. If he has, for example, recently lost his job and has barely enough for his daily needs, don’t push the sale. Instead come back when he is once again gainfully employed.
If it is due to over extravagance in spending on luxury items, for example, and his family really needs the insurance protection you are proposing, then you will need to show him that it is not the budget that is the problem but rather a matter of priority. And here is how you can do this (simply replace the $3,500 in the script below with the actual amount of premiums you are proposing)…
Agent: Mr Prospect, if one day, our government were to change the tax rates and increase your income tax by $3,500, what will you do?
Prospect: No choice. Got to pay I guess.
Agent: But just awhile ago, you mentioned that there was a budget issue. So eventually in such situations, you will have no choice but to pay up and then reprioritize the rest of your spending right?
Prospect: I guess so.
Agent: So you see, Mr. prospect, similarly today, we are really not taking about a genuine money problem; instead it is just a case of reprioritizing our spending, wouldn’t you agree?
Prospect: I suppose so.
Once the prospect agrees that it is only a matter of priority, you can easily go on to show why insurance should take precedence over some of the less necessary spending and from there close the sale.
Getting clients to prioritize and set aside money for life insurance is not difficult, as I have shown you. That said, I cannot stress how important it is to use this method responsibly; don’t ever be tempted to oversell anyone. Instead take good care of all your clients and you can be sure they will in turn take good care of you.
Share Your Thoughts
Now that you have heard from me how I would handle such situations when selling insurance, how about sharing your thoughts and ideas. I am sure our readers will want to hear from you.
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