Why Does Everyone Want to Sell Life Over the Phone?

Full Throttle

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It seems like there is a new post every day about someone new coming into the health or life industry that wants to sell completely by phone. Personally, I would rather go shop at a department store (my worst nightmare) than call internet leads all day trying to sell life insurance.

For health, I see how the model works. Even though it sounds aweful to me, I get it. If you want to cross sell some life to your health leads, all the better. The key to why I believe it works for the health business: perceived as a necessary product (yes, I know that's not across the board), but most importantly, renewals.

For life, there are virtually no renewals. That seems like a hard way to make a living, always searching for your next sale. I suppose with volume it could work, but it seems like building a local clientele would be much more profitable in the long run. Working internet leads for life coverage, I see many disadvantages:

-you are dealing with price shoppers that are seeing super preferred rates from other agents even though they will never qualify

-good luck cross selling disability or opening up voluntary benefit cases off an internet lead with any consistency.

- I would guess selling the proper death benefit amount when competing with other agents would be much more difficult as you aren't viewed as a professional, rather a vendor. You will therefore be selling lower premiums, not even taking into account fewer permanent sales.

-term conversions would have to be near zero, I highly doubt many phone sale agents are converting much coverage, this is essentially the "renewals" in term insurance.

-getting consitent quality introductions to others would have to be much more difficult as well given you are more of a vendor than viewed as a professional.

Everyone will shout at me, "but you save time not having to drive, you can talk to more people." In the short run, I bet you could make as much money (maybe even more) selling over the phone, but I guarantee any half serious traditional life insurance agent would lap that phone agents sales by a huge margin in years 3+.

My point, besides selling life by phone sounding like a miserable way to make a living to me, I don't think most people inquiring about selling life by phone understand this isn't a panacea in which you sit in your PJ's a make an enormous amount of money. If you have a personality, you become a student of the game, you use a "high touch" approach, this business can be very fun and rewarding (both financially and emotionally).

Anyone that's new and considering phone sales, make sure you at least look at both ways of doing business.
 
I'm new to the insurance industry, but spent several years in the car business and I always noticed the repeat/referral business was much greater on 'in-person' sales as opposed to internet leads. The same person that buys from you on a cold phone call will probably switch to your competitor on a cold phone call, I would imagine.
 
I guess I'm a tad confused over what exactly you mean. Are you criticizing cold calling as a means to prospect for life insurance sales?

I would definitely agree that the best way to build a practice is to network and call on those you already know to talk about your practice and look for new prospects through them. However, I would also point out that there is a degree of business you be drummed up from colder methods of prospecting--I've done it with a degree of success with small business owners. I think it depends greatly on your ability to build a relationship with people in either case. Some of my best clients and relationships have come from people who were prospected through a cold call. It has it's draw backs, but it can work.

On the other hand, if you mean purely people who think they can sit at a desk and talkin on the phone all day and make sales, I would say this is someone who isn't long for the business.
 
I would definitely agree that the best way to build a practice is to network and call on those you already know to talk about your practice and look for new prospects through them. However, I would also point out that there is a degree of business you be drummed up from colder methods of prospecting--I've done it with a degree of success with small business owners. I think it depends greatly on your ability to build a relationship with people in either case. Some of my best clients and relationships have come from people who were prospected through a cold call. It has it's draw backs, but it can work.

100% agree with you, 75% of my clients came from cold calls orignially. I was talking about the latter case, people planning to sell life insurance sitting behind a computer all day, not planning on seeing anyone out in the field.
 
When I was in high school I worked at McDonalds. Most of my hours were on weekend nights, I saw a few of the older high school guys working day time on the weekends. I told our manager that I wanted to learn how to work breakfast, he told me to learn the evening business first and then we'd talk about the early shift.

It seems that many of the guys that want to be underwear agents are newly licensed. I say learn to sell eyeball to eyeball and then you might can transition to some meaningful success selling over the phone.
 
-"you are dealing with price shoppers that are seeing super preferred rates from other agents even though they will never qualify"

---You get this with internet leads, but I pull out a UW guide while being certain the prospect can hear me flipping through and I ask the questions and read the UW guide to them.

-"good luck cross selling disability or opening up voluntary benefit cases off an internet lead with any consistency."

---We do a lot of cross-selling, up selling and referral business all over the phone.

- "I would guess selling the proper death benefit amount when competing with other agents would be much more difficult as you aren't viewed as a professional, rather a vendor. You will therefore be selling lower premiums, not even taking into account fewer permanent sales."

---You are viewed based upon the image you portray. Only a rooky makes the mistake of selling solely based on price. I would like to sell more UL, but we sell a fair amount over the phone.

-"term conversions would have to be near zero, I highly doubt many phone sale agents are converting much coverage, this is essentially the "renewals" in term
insurance."

----Why would you highly doubt this? We do plenty of conversions.

-getting consitent quality introductions to others would have to be much more difficult as well given you are more of a vendor than viewed as a professional."

----Again, you are viewed based upon the image you portray. I just placed a $6000 Ann. Prem. case on a referral from a client I wrote in 2005.
 
I enjoy selling over the phone for many reasons. The biggest is that I'm not limited geographically. It's important to educate your prospects about the typical agent out there who may be quoting teaser rates. Sometimes I'll send them a copy of the company's UW guidelines I'm quoting to show how they fit into the class I'm quoting, and tell them to only go with the "other guy" if he can show you the same.
 

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