If you are an insurance agent or broker, or you run an insurance agency; this might just be the right time for you to either “specialize” in life insurance or concentrate more on it. More and more customers are joining the bandwagon of life insurance, and the once-regarded-as-old-fashioned policy is now back in favor. To meet the booming demand for life insurance, big insurance companies are adding thousands of agents and planning to sign up more.
And they are really taking advantage of the weak job market to scoop up former bankers, lawyers, real estate agents, and mortgage brokers whose prospects have declined due to the global economic recession. Companies like New York Life Insurance and Northwestern Mutual Life Insurance (both in the united states) have been adding thousands of life insurance agents to their folds since 2009.
The resurgence that happened in this niche of insurance, especially in the United States, is amazing. At a time in recent decades, companies deemed life insurance agents too expensive to recruit, train, and subsidize in their early years, after which many soon gave up and left. This explained why companies that once had tens of thousands of agents started to rely increasingly, instead, on stockbrokers, banks, financial advisers, and the Internet to make sales.
Back then, life-insurance (also known as whole life), which is the mainstay product of life-insurance agents suffered a big blow due to two reasons—the scandalous way some agents sold the products and the widespread view that it wasn’t a very good investment.
However, the recent economic crisis turned things around. Many people who have lost heavily on stocks are now turning back to whole life insurance because they think it’s better and more secure. And insurance companies are now signing up new agents in a bid to take advantage of the situation.
So, the market for life insurance is booming. And there are huge profit opportunities for insurance agents selling life insurance. Aside the skyrocketing demand for life insurance, there are many other benefits attached to selling whole life insurance, which are more-than-enough reasons for you to concentrate more on that niche. Here are some of the benefits:
5 Reasons You Should Sell Life Insurance as an Agent or Broker
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1. Next generation risk
By establishing life insurance programs for your clients, you will be able to establish relationships with their families. This can ensure that you will continue to manage their portfolios when the client dies. And they can even buy life insurance from you.
If you have sold life insurance to my dad; which was greatly beneficial to the whole family after his death, I may consider becoming your customer. Better yet, I may convince my mum or other relatives to buy whole life insurance from you. So, one satisfied customer will lead to more sales—just as it happens in any other business you can think of.
2. Exit strategy
Life insurance pays huge up-front commissions and annual renewal commissions. This will increase the value of your practice, even as you enter a more passive phase. Imagine what it would be like to have huge sums of money landing in your bank account even when you are out of the insurance sales profession. That’s what happens when you sell life insurance to customers, and those customers renew their policies year in year out.
3. Customer trust
The average individual sees insurance companies and their agents as “money-pirates who continue to collect your money every year but make every attempt not to release the money when you need it.” This mindset is particularly reserved about other insurance policies which require that you keep paying premiums even when you are at little risk of what you are insuring against.
But the case of life insurance is different. Death will surely come one day, which means your premiums will eventually pay off. This sense of assurance that comes with life insurance increases customers’ trust in life insurance companies and agents.
Your clients will expect you to know how much life insurance they need. To do so, you or an insurance specialist advisor will, in part, need a complete inventory of assets as part of a fact-finder. Some of these assets may be better managed by you, if not already.
5. More sales through referrals
If you are quite professional in the way you deal with customers, listen to their concerns, and offer professional advice, they will refer their friends and relatives to you. That means more sales, and more passive income in the long term (renewal commissions). While you can get more benefits, the ones explained here should be enough to convince you as to why selling life insurance would be a great decision.