Risk Clinic: How to secure successful protection sales?

Damian O’Connor, Roxburgh Financial Management

An adviser has a key differentiator to call centres, providers, comparison sites and non-advisers that gives them the best opportunity to make and retain protection sales.

They have the specialist knowledge and technical skill to guide the customer to the most suitable products, at the right price, with the best insurer through difficult underwriting and with important additions such as trusts and indexation. If a claim is made, they can fight for their client to make sure it is paid swiftly, with the minimum of effort, to the ill policyholder or the bereaved family.

When a client understands all this added value and the adviser demonstrates how much they can add to a client’s financial decision-making, it binds the clients to the adviser’s business.

The key is to communicate the extra value an adviser adds to the client in a way they can understand. It is not necessary, for example, to go into huge detail on trusts on a first call or meeting. Trusts are important but that discussion can come later.

What is important is that advisers set customer expectations early, help them understand how much more there is to a purchase than price and then keep in regular contact with the client during the application and underwriting process to ensure they don’t drop out along the way.

Well-communicated quality advice is a powerful sales and retention tool. We all understand the importance of advice, and successful sales depend on
us helping the client to understand it too.

Roy McLoughlin, Master Adviser

It’s a mind-set of making protection the bedrock of holistic financial planning. It’s great talking to people about pensions and investments, but if something goes wrong these will not be protected. It is crucial to make protection an integral question. Part of that is a training issue, which I found out recently in adviser training workshops.

With fact-finds, covering debts is a no-brainer. The mortgage is generally the biggest one. But in a renting society, people need to make sure their rent is covered as well. If someone is ill, the landlord is not going to let them off the rent. There could also be something as simple as school fee planning – why aren’t people insuring against that?

Private medical insurance is the fourth protection product. We neglect that too much; it gets forgotten in the ether and it’s worth advisers discussing that.
It’s also about knowing the balance of asking a question that could be seen as a disturbance question, as it may be a positive question for the client. Don’t be worried to ask a client what would happen if something in their life went wrong, as no one else in their life will be asking them that.

The other assumption is that people are covered by their workplace. A problem that IFAs have is they assume that is the case. IFAs need to ask that question and drill down to the answer. People say ‘I’m covered by work.’ Should we get evidence of that?

Andy Walton, Intrinsic Financial Services

Why would someone commit to paying for protection? In simple terms it comes down to the client believing there is a possibility they will need to make a claim in the future and that the benefits paid out will help alleviate problems. Therefore we need to help clients understand the risks or, one might say, understand
the gamble.

One simple way of helping clients understand the gamble is asking them what they believe might happen, rather than you telling them what might happen. Most clients will give you all the ‘right’ answers, and this is far more powerful.

Secondly, we need to establish whether the client thinks these things may happen. If the client does not believe they will ever suffer from a long-term illness, they will never take out protection for that eventuality.

Does the average client know the odds of dying or getting critically ill? This is the next step – we need to demonstrate, using bespoke statistics, the chances of these things happening.

These figures form an excellent discussion point, but you then need to turn figures into faces. The client should know people who have gone through some of these things – be interested in the people they talk about. This makes the situation real.
Finally, there is a discussion about which risks they would like to resolve and in what order.

All of this initial discussion should be done before any hard fact-finding and before any figures are asked for. Objections need to be overcome at this point and not at the end of the sale.

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• Topics
• Individual Protection
• risk clinic
• IFA
• Roxburgh Financial Management
• Master Adviser