$0-$15K Final Expense Direct Mail For Final Expense

[theinsuranceman]

Conventional wisdom says that you should avoid the $0-$15K income when doing FE direct mail drops. Some agents on this forum have also said they avoid this group when doing their mailings.

My question is as follows: Has anyone worked several months of FE leads WITH this group and ALSO worked many months WITHOUT this group? Trying to see if there is a major difference or minor difference in production and/or bank draft business and/ or persistency. I've always had this income group in my mailings. It seems 90% of the people I make presentations to could be in the $0-$15K income group.

I've always performed above ave. in FE (this is all I do). Does anyone have any hard evidence about including/not including the $0-$15K group?

 

[G.Gordon]

I used to include "all income" in my mailings. There are big errors in the data bases and IMO the income estimate is #1 for being wrong. I used to buy the list after I mailed it; the same list. You'd be surprised how many dead, moved, or "property owned by, but not living there" names are on those list. It was the most eye opening discovery about doing direct mail. My opinion on the income stats was due to looking at the list and seeing a residence reported at $60-70k, but it was a poverty stricken dump, or a huge farm with a $300k house, $1mil horse barn, etc. listed at $15-20k

 

[5pill]

As a brand new agent, I worked $0-$15 income exclusively all last year and it drove me out of the biz;......worst thing was,,,, I wrote mucho, mucho, mucho policies. You know what that means? Persisitancy was about 50 %!

Gotta have a financially strong customer. (25,000 and up income, according to a list), in my opinion.
I think pursuing those will result in less sales, but better premiums and persistancy.

 

[Mark]

My question is, do you avoid PO Boxes when doing a FE mailing? Does it matter?

I've been told both ways..

 

[alphawave2k]

As a brand new agent, I worked $0-$15 income exclusively all last year and it drove me out of the biz;......worst thing was,,,, I wrote mucho, mucho, mucho policies. You know what that means? Persisitancy was about 50 %!

Gotta have a financially strong customer. (25,000 and up income, according to a list), in my opinion.
I think pursuing those will result in less sales, but better premiums and persistancy.

I totally agree with your experience. Why would anybody thnk $0-$15K income level is fertile ground for FE policies. Intuitively, let's put things in perspective. First you gotta eat, and you need a roof over your head.....your basic necessities. Then if you drive you need car insurance (mandatory in GA anyway, don't know about the rest of the states), then you've got house insurance (another mandatory if you still have a mortgage, and even if you don't, unless you're insane). Then what about your health insurance...isn't that a more immediate need that will take precedence over FE or a life policy?
Add up all those costs, and the senior will be left short somewhere...the first thing to give will probably be the FE policy, no immediacy unless diagnosed for terminal, IMHO.
I would personally ratchet up the income level to at least the $20K's as a minimum.

 

[HarryRenard]

I totally agree with your experience. Why would anybody thnk $0-$15K income level is fertile ground for FE policies. Intuitively, let's put things in perspective. First you gotta eat, and you need a roof over your head.....your basic necessities. Then if you drive you need car insurance (mandatory in GA anyway, don't know about the rest of the states), then you've got house insurance (another mandatory if you still have a mortgage, and even if you don't, unless you're insane). Then what about your health insurance...isn't that a more immediate need that will take precedence over FE or a life policy?
Add up all those costs, and the senior will be left short somewhere...the first thing to give will probably be the FE policy, no immediacy unless diagnosed for terminal, IMHO.
I would personally ratchet up the income level to at least the $20K's as a minimum.

The only part of this you are missing is that a lot of these people have been raised with different values and it's been beaten into their heads that they MUST have insurance.
They consider the "insurance man" family he would stop by once week.

I am not saying that group can not be problimatic BUT when you get them on the books they stay.

I wouldnt totaly market to 0-15k but I probably wouldnt exclude them either.

 

[Frank Stastny]

... You'd be surprised how many dead, moved, or "property owned by, but not living there" names are on those list. It was the most eye opening discovery about doing direct mail....

In my opinion that speaks more to the quality of the list than the stated incomes. I have purchased low cost lists in the past only to find out when I started calling that the people hadn't lived there in the last five years or died three years ago.

 

[Newby]

I reviewed a list several years ago that had already been mailed for me. It had my brother listed at an apartment that he had lived at 18 years earlier. He had only lived at the apartment for 1 year and had bought two houses since and lived in one 8 years and the current one 10 years.
The same brother was listed in RL Polk's directory as a high income earner (over 1-million income per year.)
He is a union drywaller so I doubt he hits that mark most years.

 

[alphawave2k]

The only part of this you are missing is that a lot of these people have been raised with different values and it's been beaten into their heads that they MUST have insurance.
They consider the "insurance man" family he would stop by once week.

I am not saying that group can not be problimatic BUT when you get them on the books they stay.

I wouldnt totaly market to 0-15k but I probably wouldnt exclude them either.

Not trying to start a long-threaded argument with you or anyone else. We're each entitled to our opinion, and if you back it up with selling success or good logic, I'm always willing to listen. If we're supposed to rationalize this market, and thinking about all the basic necessities WE ALL need such as food, shelter and any other immediate need or mandatory one for that matter, some will take take precedence. Here's an easy example...would anyone choose buying groceries over having insurance????
In any sale, and particularly in insurance, from what I"ve read on this forum and elsewhere, if you don't have an immediate need and desire, you really don't have a qualified prospect.
So, if someone has been thinking about FE regardless of their income level, they'd be a good prospect, but they would be limited by their budget. If it is not on their immediate horizon such as having a terminal illness, or someone close to them dying and not having a policy, that would also spur their "need"or desire to buy one.
So, yeah this "group" would be OK to sell FE to, however, better persistency might lie with a slightly higher income "group". There might even be a cross-selling opportunity such as a Med Supp or ???. But if you're taking the last few $$ out of their budget...(which BTW I wouldn't feel right doing anyway)...what other opportunities might you have to sell another product??
I'm not trying to argue or convince anybody just stating my opinion, which on this forum can sometimes ruffle some feathers for some reason.
Here's my approach...I read a lot of posts...don't always agree..don't always comment...and don't always learn. But I've learned a lot from other people's posts and from some conversations I've had with some good people on this forum. But as most of us do over time, we will incorporate what feels right and makes sense to us, the rest we know it's there and can always reach back should your thinking change. Specially if it's "change we can all believe in"

 

[Frank Stastny]

I agree with both Alpha and Harry.

Personally I would never again try to market just FE, especially to the ultra low income people. I tried it once for a very short time and that was all the fun I could handle. However, there is an element of society who do not see the need for health insurance and are not even remotely interested in it but definitely want and feel that they need burial insurance.

The downside I see in selling to those people is figuring how to get the premiums paid and getting them to keep it especially if they don't have a checking or savings account. That is debit agent country as far as I'm concerned.

The biggest deterrent for me to solely market FE is that I see FE as a "one year money maker". First year commissions are extremely nice but renewals leave a lot to be desired.

A FE expense agent must work every day. That is too much like a "real job". Most FE agents I have talked to think only in terms of first year commission. Once they get that they have earned the bulk of the money from that sale and they move on to the next prospect.

Something else I saw in the very short time I tried it was that a lot of the policies the ultra low income people already had were owned and paid for by an older family member. I talked to elderly women who were paying the premiums for policies on their children and grandchildren. I remember one woman who was paying over $300 per month for policies on her family.

I have a lot of FE on the books but virtually all of it was sold to a client who I saved money for on their Med Supp.