Is the Final Expense Market Overly Saturated?

Tom Highway · 04-01-2009, 08:44 PM

I currently am looking at expanding what i do to include FE. It seems pretty straightforward with some good opportunites for someone willing to work and sell to make some good money.

My question is, though, is the market for FE overly saturated? Are there tons of agents prospecting to the same people in an area over and over and over?

Markingriffin · 04-01-2009, 09:07 PM

This is not a problem, unless you live in a town of 20 people and half of them are insurance agents.

Also, just try to stand out from the other agents in your area. Be an expert in Final Expense and have good products.

It is not about selling insurance, but about selling yourself and your services.

insuranceexec · 04-01-2009, 09:43 PM

You are very correct, Mark.

briko3 · 04-01-2009, 09:50 PM

Someone please explain to me what Final Expense actually is. How is it different than normal LI?

insuranceexec · 04-01-2009, 09:51 PM

Originally Posted by briko3

Someone please explain to me what Final Expense actually is. How is it different than normal LI?

Smaller face value, and easier issue.

jjjtrio · 04-01-2009, 10:27 PM

The application is only 1 or 2 pages and consists of some general health questions and about medications.

If they answer yes on one or two of the questions they will then qualify only for a graded policy. Do a phone verification w/ the Ins company and your done.

A few days later you get paid and hope it stays on the books.

You will have some crazy experiences.

TRK3031962 · 04-01-2009, 10:45 PM

The Final Expense market is no more saturated than any other market. The only problem I see in the FE market is that there are so many agents doing it without selling Medicare Supplements too. It astounds me the number of agents who are just leaving money on the table when they could be helping that senior and saving them money, therefore maybe even showing them how to afford that FE product they just bought!!

Tom Highway · 04-06-2009, 08:16 PM

Thank you!

What are the typical closing rates for FE - if you see X number of qualified prospects you got through cold calls or mailouts, would you typically close 10%, 20%, 30%, or what? (if you represented a good sample of competitive carriers)

Is this being an average salesperson, or a superstar?

cpete1993 · 04-06-2009, 09:56 PM

Does anyone know if Forethought Life requires E&O insurance?

Newby · 04-06-2009, 10:30 PM

Originally Posted by cpete1993

Does anyone know if Forethought Life requires E&O insurance?

No. I have appointed agents with no E & O with Forethought.

TRK3031962 · 04-06-2009, 10:35 PM

Originally Posted by Tom Highway

Thank you!

What are the typical closing rates for FE - if you see X number of qualified prospects you got through cold calls or mailouts, would you typically close 10%, 20%, 30%, or what? (if you represented a good sample of competitive carriers)

Is this being an average salesperson, or a superstar?

I would say on direct mailers at $335 per thousand...you order 1000, get back about 1.5-2%. I've always seen closer to 2%. So that means you get back 20, set 10, sell 2-3. I think personally you should strive for 5+. But you need to get ready and be prepared some answers and phone skills when you do. You should also go see them, but it you can't, so you sell it over the phone, your ratio probably went down by 1 or 2%.
So, you make on the average of a $40 sale x 110% (probably more) = $44. Now $44 x 9 (number of advance month if you do advances) = $396 ($528 for the year). So x 3 policies = $1188 or $1584 for the year. Of course you have to deduct the $335.
A superstar would do 5 or better of the 20 lead cards returned.
A superstar would also learn medicare supplements and sell them along with the FE too. Just my experience and opinion.

VaDwayne · 04-06-2009, 10:53 PM

Originally Posted by TRK3031962

I would say on direct mailers at $335 per thousand...you order 1000, get back about 1.5-2%. I've always seen closer to 2%. So that means you get back 20, set 10, sell 2-3. I think personally you should strive for 5+. But you need to get ready and be prepared some answers and phone skills when you do. You should also go see them, but it you can't, so you sell it over the phone, your ratio probably went down by 1 or 2%.
So, you make on the average of a $40 sale x 110% (probably more) = $44. Now $44 x 9 (number of advance month if you do advances) = $396 ($528 for the year). So x 3 policies = $1188 or $1584 for the year. Of course you have to deduct the $335.
A superstar would do 5 or better of the 20 lead cards returned.
A superstar would also learn medicare supplements and sell them along with the FE too. Just my experience and opinion.

I hope to one day be a superstar !!!

TRK3031962 · 04-06-2009, 10:56 PM

Originally Posted by VaDwayne

I hope to one day be a superstar !!!

I hope you are too!!

Tom Highway · 04-07-2009, 08:14 AM

Thank you again!!

Follow up - what is considered, on average in most areas, an average number of sales to write per week, and a good annualized premium (the number of sales you pretty much can count on doing with a decent amount of effort from week to week to week)? How about a superstar level (really getting out there and busting it)?

inreverse · 04-07-2009, 10:11 AM

I think the response numbers for FE direct mail are much closer to 1%,
Then work your way down from there. You better have deep pockets to weather the ups and downs with direct mail. I got 11 responses from my first 4000, using the standard $255 mailer.

Newby · 04-07-2009, 11:22 AM

Originally Posted by TRK3031962

I would say on direct mailers at $335 per thousand...you order 1000, get back about 1.5-2%. I've always seen closer to 2%. So that means you get back 20, set 10, sell 2-3. I think personally you should strive for 5+. But you need to get ready and be prepared some answers and phone skills when you do. You should also go see them, but it you can't, so you sell it over the phone, your ratio probably went down by 1 or 2%.
So, you make on the average of a $40 sale x 110% (probably more) = $44. Now $44 x 9 (number of advance month if you do advances) = $396 ($528 for the year). So x 3 policies = $1188 or $1584 for the year. Of course you have to deduct the $335.
A superstar would do 5 or better of the 20 lead cards returned.
A superstar would also learn medicare supplements and sell them along with the FE too. Just my experience and opinion.

Todd, in my experience you may be a little optimistic about the number of mail replies BUT underestimating the number of sales per lead.

20-per thousand happens but 1- to 15 is more like it. Especially these days when they are getting tons of these lead mailers from dozens of companies.

But one lead will often be a husband and wife (2-sales) and with FE you ALWAYS get lots of referals (more leads.)

If I have 10 $255 lead cards, usually 3 of them will be good but the 3-good ones will result in 6 to 8 sales.

To be successful, you need a main go-to company, and alternative companies to go to if they have certain ailments, overweight, guaranteed issue, etc.

TRK3031962 · 04-08-2009, 09:34 AM

I was taking into consideration that he's in Alabama. Should be a better return there as compared to the upper states. Yes, I know I was low on the number of sales, but I don't like to overestimate that part because if he doesn't reach it he'll be disappointed and have a tendency to want to quit. That's what happens in the churn and burn places where they pump you up with unrealistic figures and when it doesn't happen you feel inadequate and start questioning your career choice. If you do better than you expect then you do feel like that superstar and it makes you want to stay at superstar level.

AgentBartlett · 04-09-2009, 06:13 PM

If you are in Michigan, yes, it's COMPLETELY over saturated. Better stick to giving away MA plans. Don't go chasin' waterfalls and all that.

Sarcasm, of course. Put it this way, I will not be taking any "re-certification" exams for massacre advantage next fall. I don't need Barry O'bama cutting my commission in half prior to taxing the crap out of it. That was dirty

Merlin · 04-09-2009, 09:14 PM

1000 flyers with a 1.5% response means that there are 985 people left, some of whom would listen to us talk their ear off about final expense. The key is finding a way to get in touch with these people. I know one agent who has a telemarketer call those 985 and ask them why they didn't fill the form out(something to that effect). He does well, I mean his ROI is pretty decent. So, in answer to your question I don't think the market is satruated at all but it may take a little extra work to get to the others.

kuhn123 · 04-16-2009, 12:21 AM

Originally Posted by Merlin

1000 flyers with a 1.5% response means that there are 985 people left, some of whom would listen to us talk their ear off about final expense. The key is finding a way to get in touch with these people. I know one agent who has a telemarketer call those 985 and ask them why they didn't fill the form out(something to that effect). He does well, I mean his ROI is pretty decent. So, in answer to your question I don't think the market is satruated at all but it may take a little extra work to get to the others.

Please expand on this guys ROI. I would be interested on what kind of results he has by following up a mailing by calling the non-responders. I have had agents tell me that they plan on doing this, but have never heard from anyone what the end result was.

I imagine that if he got even one sale out of this, that his ROI would come out decent. But...........If you place any value on your time (or the cost of the telemarketer), I would have to imagine that the ROI would be low. If you can do decent with this, why even pay for the mailing? Why not just buy the list and call all 1000 of them?

I have no personal experience with this though, just hypothesizing. Please let me know what kind of results he got by calling on these 985 non-responders.