Last week I met with a couple that had been referred to our office by their accountant. They were looking for a comprehensive retirement plan.
While they had several millions in investments and real estate, that wealth had diminished by nearly 50% as a result of recent market volatility. Now they were concerned about their future and wanted a plan that would guarantee enough income to live out their lives comfortably, enough funds to pay any capital gains taxes, and the ability to leave a legacy for their children.
During the fact-finding stage of the interview I asked the major income earner if he had any life insurance.
His answer? “Oh, no, I don’t believe in insurance of any type.” My standard reply to this comment is, “What exactly is it that you don’t believe in?” He answered, “I don’t believe that I should help make the insurance company rich. Besides, I can take care of myself. I have enough assets.”
This familiar exchange usually indicates the prospect simply doesn’t understand the insurance product and needs a lesson in the basics. During these Insurance 101 conversations, I explain to the client that insurance is simply a contract that facilitates the transfer of risk. It makes sure the needs and aspirations of individuals can be met even if they run out of time or the ability to accomplish their goals because of sudden illness, disability or death.
Of course, it’s true if we all knew what was in our futures, we wouldn’t need insurance. If we knew we’d reach the other side of the street each time we crossed it, or that all of our investments would always be successful, we wouldn’t have any risk to transfer to the insurance company. If we knew that we wouldn’t get sick, health insurance plans or long-term care plans wouldn’t be necessary. But, we can’t know those things, and it’s that precise reason why insurance plays such a critical role.
Learn From the Best
The master of the basic needs insurance sale was also the world’s most famous insurance salesman. He was a simple man, a son of Russian immigrants who never finished high school and spoke slowly with a distinct lisp. But Ben Feldman from East Liverpool Ohio, a river town of 20,000 people, sold over $1.8 billion worth of life insurance from 1942 until his death in 1983. Throughout his career, Feldman was able to convince people that an intangible product such as life insurance had incredible value. No matter the economy, or the state of the markets, a client could rely on the product to deliver what it promised. Feldman would say, “Life insurance is the most tangible form of security devised by man.”
Late in his career, Feldman would travel to his clients with two bodyguards and a satchel filled with $1 million in cash. He would present his prospect with a $100 bill and say to them, “If you give me one of these each year, at some time in the future I’ll give your family one of these satchels.”
Ben Feldman had a message for his prospects that rang true during his career and still does so today. It’s a message of certainty that’s embodied in a product designed for periods of turmoil.
Life insurance, disability income, critical illness or health insurance plans are, simply, contracts designed to help our clients find solace and peace of mind— plans that protect their families and loved ones in times when life and finances are uncertain and unpredictable. Times like now.
The message for you as an advisor is clear. Now is the time to meet with your clients. Now is the time to pick up the telephone, to be visible, to call them.
You, as advisors, have the ability to offer them a product that can help create certainty in these uncertain times. It’s time for you to turn your prospects into believers.