The job of a life insurance agent often feels like that of an ice salesperson in Greenland. Not only is the coverage optional (except for a few policies such as auto liability), but also, most people don't inherently feel that they need insurance.
You often encounter individuals who have an estate but don't yet appreciate the financial reality of untimely death and leaving behind an unpaid mortgage and loved ones without a stable income. So, most prospects usually need more than a little encouragement to entertain a conversation about purchasing life insurance.
The good news is that, unlike Greenlanders who don't need to buy ice, many people who don't see the value in a life policy can change their views about it. Also, 16% of consumers (roughly 41 million people) without life insurance acknowledge that they need it.
Tactfully getting these consumers to start thinking about their coverage needs is the first major obstacle to overcome in a successful sales process. Here's a look at some practical life insurance selling strategies for agents.
7 Tips to Improve Your Life Insurance Sales Closing Rate
1. Forget about selling
If a sales theme dominates your conversation with a prospect, it's almost guaranteed to backfire. With a salesy approach, it's easier to get carried away and focus on the least of a consumer's every day worries. The conversation won't go far unless you prioritize building a relationship with the prospect because this is what life insurance is all about.
Instead of just selling, anchor your approach on common grounds—relatable day-to-day concerns for the prospect. You'll need excellent storytelling skills to pull this off.
Establishing an emotional connection shouldn't be difficult, considering death is itself an emotive subject, and so are the hardships that many spouses and children face when their breadwinner dies without securing their financial stability.
Try to creatively weave these concerns into your narratives, such as funeral expenses, unpaid mortgages, or children's college education. Then, paint a picture of how having a life insurance policy can ease these concerns and is also an act of love from a caring parent or partner.
You'll get closer to closing a sale once there's an established emotional link with the prospect. With a solid relationship in place, you can at the right time incorporate relevant facts and data to help the prospect make an informed purchase choice.
2. Be a problem solver
Being a problem solver helps a lot when you run into a prospect who doesn't think they need life insurance. Pitching to them right away doesn't usually work because you don't even know what their exact situation is. Instead, start by asking questions to learn more about the potential client's needs.
Not many people have thought about the exact amount of money that would be needed to adequately cushion their dear ones for any duration after their death. By asking thought-provoking questions about their financial circumstances, you can persuade prospects to consider their unforeseeable future in a different way and perhaps identify a few worrisome exposures.
Once you perfectly understand their financial situation, start thinking about how you'd solve the problem if you were in their shoes. It's going to be a learning process for both of you, which should enable you to find the best fit coverage for their specific situation. Besides, offering a real, personalized solution will boost your chances of making a sale.
3. Give fewer options
Offering multiple coverage options makes sense since different types of life insurance plans suit different coverage requirements and budgets. However, too many options aren't as empowering as widely thought. According to Consumer Reports, health insurance buyers make better decisions with a few choices, and they actually prefer it this way.
Unlike corporate buyers, individual consumers don't usually have a team of experts to help them analyze and crunch the numbers when presented with 20 or so different plans. As a result, they might not be able to make sense of any difference in interest rates or specific coverage benefits between each plan.
As a life insurance agent, you don't want your prospects struggling with purchase decisions as it can hurt your lead-to-sale conversion rates in ways such as:
- Prospective policyholders will take longer to go through and comprehend more choices, which can delay an otherwise solid sale.
- Prospects are more prone to poor decision-making when faced with a complex set of choices. If you're consistently selling unsuitable plans, your life insurance renewals, cross-selling, and upselling rates can suffer, among other long-term ramifications for your business.
It shouldn't be too difficult to offer prospects a few best-fit options when you take time to understand their coverage requirements.
4. Work on objection reversal tactics
When a prospect objects to your pitch, it doesn't automatically mean they're a poor fit. On the contrary, you might be able to persuade them to change their views by easing their concerns without imposing yourself. For example, you may face objections like, "I need some time to think about it" or "I have to discuss this with my wife."
To respectfully overcome such resistance, try these strategies:
- Show empathy in your immediate response: You can say, "I totally understand why many people would need time to consider this plan…" By showing that you relate to their concerns, you can lower their guard and buy yourself some extra time to try and close the sale.
- Get the prospect to share their specific concern: Follow up your initial response with, "what do you mean by…" or "do you mind sharing any specific concerns." This is a non-intrusive way to get the prospect to open up.
Common objections include high life insurance costs or a prospect not sure if they need this type of coverage.
- Isolate the concern : Probe further to find out if there's some hidden issue. To handle a specific concern, you can say, "If I can show you that this is the right time to look into low-cost life insurance protection for your family, would you be willing to get started?"
Check out this short video by David Duford who discusses his best practices for handling objections while closing life insurance sales:
5. Create urgency, but don't push
If you have to push too hard to close a sale, it means that the prospect doesn't yet recognize the need to buy. Pushing a sale backfires because it's based on a false sense of urgency from the prospect's perspective.
Nothing demonstrates this detrimental effect better than a study where a firm's end-month promotions generated a threefold increase in closed sales. However, their overall sales win rate declined by 51%.
Instead of pushing for purchases, life insurance agents should create urgency with the right questions. For example, you can ask the prospect thought-provoking questions to generate awareness of their vulnerability, such as having a 25-year mortgage or losing a job.
Also, the fear of leaving behind a loved one without financial protection can elicit a sense of urgency in getting proper coverage.
6. Know your competitors
Before a prospect agrees to an appointment with you, chances are that they researched you and your competition. It's imperative that you know your competitors' products better than the prospects. This can help when you encounter objections, such as a prospective policyholder that's already exploring a competitor's coverage options.
It's easier to show that you have a superior product or better terms when you know the specific policies or coverage features your competitor is offering or not offering.
Knowing your competition well also means figuring out their differentiation strategy, which you can emulate to boost your competitiveness. For example, you can outrank rival life insurance agencies by offering better discounts for market segments (like veterans or teachers), bundled policies, or client loyalty programs.
7. Start making notes
Nothing can help you better than your own experience. By taking note of every interaction with the prospects, you can help yourself and prepare for the next meeting in advance. Remember to capture key buying clues, pain points, expectations, and any promise you make to the prospect.
Detailed notes can help you and your entire sales team to personalize the insurance customer experience. Also, making notes during prospect meetings gives an impression to the prospect that you care about their requirements.
Combine Your Sales Tactics with Digital Strategies
Having excellent sales skills can improve your closing rates. Nonetheless, you also need to have a lead generation strategy in place that can keep bringing in high-quality hot leads for life insurance. That requires a strategic and targeted marketing approach and incorporating the digital experiences that modern-day insurance consumers prefer.
An active social media profile and agency website with online live chat can help you better target these digital segments. Moreover, by providing opportunities for virtual interactions, you can influence more prospects to consider buying your life insurance products.
Another way to differentiate when prospecting to "digital" millennials or generation X is by having a reviewable online presence. The majority of the younger consumers will compare agency reviews before purchasing a plan, so it's vital that you maintain a good reputation on the web.
Is your insurance marketing strategy keeping up with the rapidly changing consumer preferences and technology? At Stratosphere, we offer holistic digital marketing solutions for insurance agents. Contact us today to learn more!