TERM LIFE
Term insurance from page 33
Fortunately , the price of term insurance has dropped significantly over the past 20 years or so . Unfortunately , it has become so inexpensive that not enough advisors offer it to their clients , and this is continuing the downward trend of life insurance ownership .”
Difference of opinion
For Gilpin , the presumption that first-time life insurance buyers are looking for a cheaper option may be a faulty one . “ I ’ m not sure I would agree with that description ,” he said . “ Of course , there are many term insurance sales that are made because of the cheaper price , but we actually get a lot of term insurance business that is on repeat customers and often for larger face amounts . We also get a lot of term insurance business that is for business purposes , and often those cases are larger in face amount and premium .”
I realize today ’ s consumers are looking for a different experience or journey . Amazon has proven this to be true . Otherwise , everyone would still drive to the store for all their shopping needs .
Rohrer
As for the related question regarding prospecting , Gilpin continued , “ I think the best way for the seasoned life insurance agent to find prospects is to simply mine his or her own book of business . Find those clients who are coming up on the end of their level term period , have recently been married , had children , or purchased a business . Or the agent could just pick up the telephone and call a client who he or she hasn ’ t spoken to for a while and ask to review his or her life insurance needs . An agent ’ s existing book and referrals are a great way to prospect .”
Different driving factor
Rohrer , who had expressed his concerns about the process of buying life insurance , also commented on the relationship between the cost of term insurance and the sale . “ The cost of term insurance is no longer the driving factor with all consumers . The buying experience is far more important to many of today ’ s customers . The truth is , they expect there to be a cost for a seamless and painless experience .”
Gilpin addressed pricing too , putting it in perspective relative to other considerations . “ Premium pricing is definitely a consideration for potential buyers ,” he said , “ and a big one , when it comes to term insurance . There are other factors , however , that can have an impact on what carrier is sold or whether term insurance is even the right product for the specific client we are trying to insure . Conversion privileges , carrier ratings , carrier name-recognition , past experiences , underwriting niches , application submission methods , ease of doing business − these are all things that agents and clients take into consideration when buying insurance . Our agency is very driven toward trying to find the right solution to a client ’ s needs before we get to the product and the price .”
For Hallett , premium pricing is without a doubt the key driver for sales . “ Premium is by far the biggest driver of life insurance ,” he said . “ As an industry , we want to believe it is process or riders or strength of carrier . What we have seen from the agent ’ s perspective is that we run a quote with six to ten carriers on it , and it seems like the agent chooses the lowest cost much of the time . On our direct-to-consumer side , the client chooses the lowest cost 70 % of the time , and we actually have data for that one . Price is the number one factor in choosing a carrier for term life insurance .”
34 Perspectives Q3 2022