Life insurance is a "pure" product. Sold properly, it is an excellent product, almost always needed by everyone. The key is to open with the best idea first. I use term insurance as a door-opener. A client relationship can easily be developed through term life insurance.
I recently visited my wife's jeweler. We have upgraded her wedding ring and bought several pieces over the years. I dropped in to see John, the owner, and asked for an appointment. I told him that I had a unique approach to the purchase of life insurance and that I could run it by him in just a few minutes. He purchased a 30-year term policy at a $1,000 annual premium. We have now established a mutual relationship and I'll probably buy another trinket for my wife.
Term insurance is my primary product. With term insurance, my clients are able to afford the coverage that they need rather than the coverage they can afford. As they age or at maturity of the policy, they will have the option of converting at a favorable rate. If he waits until the policy matures, John would be 82 at decision time. He may also need less than the $2 million face amount then. Return of premium is a favorite for young people under the age of 40. The premium is only about 20% higher and, of course, they will get their money back. It's like renting an apartment and getting the rent money back.
Back in the mid-1970s I worked with Zig Ziglar's brother, Judge. Judge Ziglar was an excellent sales trainer. He taught me to prospect. He gave me 3x5 cards and told me to use the following routinely, and it works at delivery of a policy. I take out a 3x5 card and say: "If your best friend were standing here right now, would you introduce us? Great, what is his first name? What is his last name? What's his wife's name? What are his children's names? What is his cell number?" If he can answer all of these questions, then his referral is truly his best friend. Then I ask him who his second best friend is. After five cards, I have at least one sale.
Powerful prospecting is an every day event. You can certainly use the mail or Internet, but I find that introducing myself to strangers can be very effective. When I am purchasing gas, I try to pull up next to someone I would like to meet based on observed age and the type of car he drives. You could conceivably do this several times per day. I recently pulled up to a pump across from a middle-aged gentleman who was driving a Mercedes. I introduced myself and asked if he was in the insurance business. He said no, so I said, "Great! I am! Here's my card. May I have yours?" He was smiling as he handed me the card. Have fun, meet people, sell term insurance first and follow up at delivery for referrals.
Lastly, I like to work with groups of people who work or associate with other people who can afford to protect their money. Getting referrals in this environment is pretty easy. The one thing that is most important about referrals is that your new client must like and respect you, or they won't refer you. If you will go to work every morning and work all day, life insurance will make you a very nice living.
More prospecting columns by Kim Magdalein.
Kim L. Magdalein is a producer and owner of PresentYourPractice.com. He entered the industry in 1985, and went into private practice in 2001 serving the Jacksonville, Fla., retirement community. He has personally presented hundreds of seminars and created a thriving practice. He created Present Your Practice in 2004 to serve producers with seminar productions and methods for optimizing seminar attendance with qualified prospects. He can be reached at (800)909-9894.
