Life and A&H Agents: How to Add P&C Products without Being Licensed

There are several truisms when it comes to marketing insurance products to individuals. For example, it is very unusual for an insurance agent to offer products outside of his or her specialty. Life and A&H (Accident and Health) agents usually won’t offer P&C (Property and Casualty) products and P&C agents feel the same way about marketing life products.

Agents stick to their areas of specialty for a variety of reasons. For one thing, they want to operate in areas where they feel comfortable and have expertise. Another reason is that a different license may be required, which entails not just the initial study and passing an examination but also regularly fulfilling the continuing education requirements.

But what if it were possible for a life or A&H agent to sell a P&C type of product which doesn’t require an additional license, is easy to understand by both the agent and prospects, and, most importantly, meets definite needs of customers? Well, there are such products now in place and available to life and A&H agents.

Not only will an agent earn commissions from the sale of the new program, but there are several other benefits for a life or A&H agent to become a distributor for P&C-type products. The most important is that the additional product sales create multiple relationships with a customer and solidify the relationship between the agent and the insured. It is an accepted fact that multiple relationships increase persistency rates and, therefore, provide more agent revenue (such as renewal commissions) and the chance to offer additional products to one’s customer base. Secondly, with the pressure now being put on commission levels, particularly for A&H agents, the program provides a new and valuable source of income.

The P&C-type products that life agents can offer are non-insurance products and generally provide supplemental benefits for typical P&C products, such as auto, homeowners and renters insurance. Because of the benefit structure of the products, legally they are not considered insurance and do not require a separate license for an agent to market the products and receive commissions.

Selling the P&C-type products is easy. There is no underwriting: the programs are guaranteed issue. The products have been designed to meet visible customer needs, so it is easy to demonstrate how the customer benefits from owning the coverage, including deductible reimbursement, maintenance discounts and repair cost reimbursement for the homes and automobiles. Moreover, the monthly cost of the products is in a price range that almost everyone can afford (typically targeting about $20 per month). All of these features, plus the availability of online enrollment for agents or applicants, make the sales process extremely user-friendly.

Agent commissions are level. In all likelihood an agent won’t make his or her primary living by selling these new products, but they will provide a meaningful stream of extra and renewal revenue. Over time the revenue stream will grow and, if nothing else, provide an agent with a strong sense of financial security or even a self-funded (but non-qualified) retirement plan. For example, if an agent regularly made ten presentations per week and closed 25% of these interviews, the expected annual commission revenue could reach nearly $20,000.

Selling insurance to a new prospect is never easy. However, selling one of the new non-insurance products, which provide supplemental auto, homeowners and renters benefits to an existing policyholder that will save the client money, is a much easier task.