A lot has changed since 1985 when I entered the senior insurance market. Back then, I worked with a captive company and learned as much as I could about Medicare, long-term care, and individual life insurance and fixed annuities.
When the government standardized Medicare Supplement plans in 1992, this product became a commodity. This was great for consumers, but not for the captive insurance agent who didn’t have the “cheapest game in town.”
So, about that time, I turned my attention to learning all I could about long-term care insurance. I was (and still am) a huge advocate of this type of insurance. Yes, it can be a difficult sale, but at the same time, a very gratifying sale. I felt we were really providing critical protection for people who wanted to maintain their independence and dignity and not run the risk of being a burden on their spouse or children when they faced an LTC situation.
We sold quite a bit of LTC insurance over the next 15 years. Then the carriers started raising rates due to claims in their pool of insured’s. I feel that LTC insurance is still important for many people, but traditional LTC policies have increased in premium so much that carriers are pricing many middle-class consumers out of the market.
Annuities also have an important place in a retiree’s portfolio. What’s not to like about fixed and fixed indexed annuities? They can help a retiree’s income keep pace with inflation (through the use of income riders) without exposing their life savings to market risk.
Marketing costs associated with finding qualified annuity prospects can be substantial. And then there is the potential battle with the Registered Rep who doesn’t want to turn loose of the clients’ money.
Our clients benefit from each of these products. I’m not suggesting that you shouldn’t talk to your prospects and clients about any or all of these. But over the years I have found that if you want to work smarter and not harder, then you need to consider making the final expense market your #1 niche.
Here are some of the advantages of the final expense market:
1) It’s a straightforward sale. When you sit down to talk with someone who has responded to your direct mail piece about final expenses, they don’t have the typical “barrier” in place that they usually have when meeting a salesperson for the first time.
2) Simplified issue. The prospect simply answers a series of medical questions. You make a phone call to the carrier, and at the end of the call they know whether they’re covered or not.
3) You never have to answer, “What if I don’t need it?” How many times have you tried helping your prospect and then been sidetracked by that objection? It’s not that we can’t handle it. It’s just that it NEVER comes up when discussing final expenses.
4) Genuine gratitude from clients. Every once in a while, when I sell a Medicare Supplement or LTC policy, my new client thanks me for helping them with this problem. But with final expense insurance, about half the time they tell me that they’ve been worried about this for some time. There is unexpected sincerity in their voice as they thank me for taking this worry away from them.
5) Yes, you can close 3 out of 5 or more. You need to have several different carriers so you can accommodate some of the different health challenges or height and weight issues you’ll be dealing with. Some agents close 3 out of 4 presentations they give. Much of their success comes from finding a motivated prospect who recognizes a problem that they haven’t taken care of yet. When you can take that worry away from them when they are most worried by it, oftentimes there’s not even an objection.
I’ve always enjoyed being a valuable resource for my clients. That’s why I’ve worked so hard over the years to educate myself on a wide variety of products. I still talk to them about these different areas. But if I was a new agent starting out again, and knew what I know now, I would definitely focus on the final expense market.
If you’ve already found your niche in this industry, whether it’s in one of the markets I’ve discussed or in a different market, I say, “Good for you.” But if you’re still trying to find the part of this industry that fits you like a glove, then I would encourage you to explore the final expense market.