Struggling to find your way as an insurance agent? Considering moving into insurance from another career? Here are seven reasons that selling Final Expense Insurance may be the right decision for you!
Final Expense insurance is in stark contrast to most other types of insurance where people are trying to protect themselves against an event that may or may not happen in the future. It doesn’t take much convincing to get someone to realize that they will be on the receiving end of a funeral someday. Our own funeral is something that all of us allow our mind to drift off to at one time or another, no matter our age. We’re born, we live, we die…… and then something has to be done with our body. It really is that simple.
You don’t have to show someone what the statistics are relating to whether or not they will someday have a funeral. It is universally accepted that some version of this event WILL occur upon our demise, and most of us are well aware that our final extravaganza will somehow not be free of cost. When you are working with a senior population, many of them have even attended the funeral of someone they knew within the past few months (and inevitably envisioned themselves in that casket), or even recently been the one responsible for stroking the check for the funeral of a loved one.
With average funeral costs over $8,000 (1), there is a significant, guaranteed expense that family members will be immediately responsible for, and most people do not want to leave their loved ones stuck with that bill. A funeral director is not going to wait for the next of kin to save, scrape, or borrow (can’t blame them for that), making it even more important that family members have an immediate solution for the unavoidable bill that looms before them. And then in you come to save the day, with a Final Expense policy that will cost them on average less than $60/month (2). You are able to show them how with very little time, effort, and expense, they can put a plan together that will give them the peace of mind of knowing that their kids/grandkids last memory of them won’t be of that one time when they had to learn how to start a gofundme.com campaign.
2 Expanding Market
The Baby Boomers? Over 74 Million of them? Well……….they’re still booming! Ten thousand of them are turning 65 every single day (that’s around 3.6mil/year for those of you keeping score at home). This pace is not projected to slow anytime soon either, as the youngest of the Boomers (born in 1964) will not reach 65 until the year 2030(3)! So we will continue this trend as the second half of the Boomers creep into their Golden Years. There is simply no shortage of prospects to see in the Final Expense market.
So the age demographic is good to go as far as the outlook for the Final Expense insurance market, but that’s only half of the equation, with income/net-worth being the other. Simply put, individuals that are frugal, plan well, and save, usually don’t find themselves needing a Final Expense policy in their later years, and that is to be applauded. However, those three key words (frugal, plan, and save) are not as common as you might think. A lack of planning coupled with shrinking pension and retirement benefits has lead to an increase in the number of people that fall into the Final Expense demographic. From a broad perspective, the Final Expense demographic is considered to be individuals between the ages of 60-80, with incomes of less than $50k annually. When you take into consideration the “aging-in” of the baby boomers, coupled with a general lack of planning, it is anticipated that the Final Expense demographic will continue to increase at a steady pace for the foreseeable future.
3 Get Off to a Quick Start
The simplistic nature of Final Expense Sales enables new agents to hit the ground running. There are no complicated products to worry about, or months long sales funnels to hold you back. No doctors records or medical exams to slow the process, the Final Expense market is built upon “simplified issue” insurance policies that eliminate the need for advanced underwriting. Most Final Expense carriers issue policies within 2-3 days of them being submitted, and an increasing number of carriers are even able to give you a definitive underwriting decision instantly, while you are in the house with a client!
New agents are able to get comprehensive training in a very short amount of time, and have fresh qualified leads in theirs hands within weeks of getting appointed. Coupled with the fact that many carriers will pay commission upon approval of the policy, and the standard practice of advancing up to 75% of commissions the agent up-front, agents can be out helping families and generating income within days of getting appointed.
4 Abundant Leads
By large part the Final Expense market is a lead driven arena. It is rare for a successful agent to build his or her practice off of cold prospecting or word of mouth. While it can be done, and referral business will increase the longer you’ve been around, there is just no need for cold prospecting when there are fantastic time-tested lead generation models in place to take that headache off your hands. Your valuable time and effort are much better spent being in front of interested, qualified prospects allowing you to do what you do best…SELL!
Direct mail has long been the bread and butter of Final Expense lead generation. It is tough to beat a lead card where the prospect is requesting product information right there in their very own handwriting! While technology is beginning to gain a foothold with the Final Expense demographic, direct-mail continues to be the most consistent method for getting in front of viable prospects. To date, no other lead generation method has shown to be as consistent and reproducible as direct mail when it comes to ringing the bell of potential Final Expense clients.
In the past, the knock on direct-mail was that you never knew how many leads would be generated for each individual mail drop. You would mail 5,000 pieces of mail and then just wait and pray that you received enough of them back as leads to keep your cost in check. That is now a thing of the past with today’s “fixed-cost direct mail” lead programs. They are truly a turn key operation. You select what counties you want leads in, how many leads you want per week, then PRESTO! Each and every week you have your 15 (or 20 or 30) fresh, exclusive leads waiting in your inbox. You know exactly what the cost per lead is, and you don’t have to sit and worry about what kind of return percentage was received on the mailing. You are the only agent that will receive that lead, unlike shared internet leads where you need to have your track shoes on in order to race six other agents to see who can get to the door first.
Everything about the Final Expense market is simple. Not to be confused with easy, because nothing about sales is ever easy. But it is SIMPLE. Everything from the prospecting, to the presentation, the close, product, underwriting, service work,………everything…….it’s all simplified. There are no complex products to learn, or mountains of regulations and disclosures to concern yourself with. Even when dealing with multiple carriers, the products are virtually the same. They are so simplified, there is not much you could possibly change to make them significantly different even if you wanted to. In todays market, most carriers even facilitate an immediate underwriting decision at the time of sale. So the entire sales cycle, from when you first meet the client, until they are approved for coverage with a policy number in hand, is often less than 1 hour; not the months on end that is common for traditional life products.
On a cocktail napkin, Final Expense products can be boiled down to this; “As long as you are still breathing, you will be paying the insurance company $50/month.” “When you stop breathing the insurance company will pay your family $15,000.” That's it. No adjustable premiums, indexes, exclusions, accumulation accounts, pre-existing conditions, lock-outs, lock-ins, whisker do’s, or whisker don’ts to worry about! Thus, when compared to other insurance verticals, there is very little service work involved with Final Expense due to this simplicity. No fielding calls of; “Why wasn’t this procedure covered?”, “What happened to my guaranteed interest rate?”, or “I thought my copay was only $20?”. Nothing changes from the day you put the policy in place, so there is very rarely client concerns that need to be addressed. Once you help a family devise a plan to cover their Final Expenses, they continue to benefit from that same plan without any interaction on your part.
6 Income Potential
With Final Expense Sales, you have an unlimited income potential. It all comes down to how many families you want to help, and how much money you want to make. You are rewarded for the time and effort you put in. Final Expense commission structures are basically designed so that the average lazy agent, can make an average lazy living off of an average lazy sales record. What if you’re not lazy you ask? Well then you can make a nice career out of selling Final Expense. And if you happen to not be lazy or average, and you are the kind of individual that sets a goal and doesn’t stop until you’ve reached it? Then that is where Final Expense Sales can be the vehicle that delivers the lifestyle you’ve always dreamed of.
Whatever your income goal may be $100k, $200k, $300k, you can easily work out a business plan and figure out how many families you would need to help in order to reach that goal. It shouldn’t be a matter of guess work as to how much money you are going to make this year. If we already know what the average size of a Final Expense sale is, and what the average closing ratio is for direct mail leads, all we have to do is input those numbers to determine how many leads you need to be working each and every week to reach your goals. This “planned production” is an important step to getting your income to where you want it to be.
Final Expense contracts also offer immediate vesting, so the business you write, is yours. Period. There is no vesting cycle where you have to wait years just to claim ownership of the book of business that you worked hard to create. You are vested from day one, and are entitled to the ongoing renewal commissions generated from every single case you write. So that family that you helped above (you remember, the one that requires little to no service work), will continue to reward you for your work for years to come. So even if your production level is stagnant year after year, your income will continue to rise as the residual income from past years begin to accumulate.
For the record, I recommend staying away from both lazy AND average, they are not your friend.
We don’t refer to lifestyle as in lavish cars and fancy homes, although finding success in Final Expense Sales can certainly provide those things if that is what you desire. We refer to Lifestyle in a “Quality of Life” context. Be in control of your life and your schedule instead of playing by someone else’s rules. Work when you want, and how you want. The only quotas you have to meet are those you set for yourself. The Final Expense market allows you to be successful, earning the income you desire, while offering the ultimate flexibility for you to be present for your own life. Want to make it to the kid’s school play at 11AM? Then set your schedule around it. Want to take time off to travel with your spouse? To devote to civic involvement? To make your kids after school activities? You are in control.
With the target market for Final Expense Sales being over age 60 and the vast majority being retired, they are very flexible in scheduling appointments, and by large part are available during day-time hours. There is no need for evening appointments or late nights on the road. You can be at home with your family or doing the things that matter to you most.
Selling Final Expense insurance certainly is not glamorous by any stretch of the imagination. You are not closing big-time deals with prestigious clients. If you’re interested in wearing power-suits, and having power-lunches with wealthy clients, then you should look elsewhere. However, with Final Expense sales, you are helping everyday, working-class people discover a peace-of-mind concerning their family’s disposition upon their passing. As some would say, you are “Selling to the masses, not the classes”. The simplicity, financial reward, and freedom of Final Expense sales is tough to beat. If you are able to find your niche selling Final Expense, it could be very rewarding for both you and your family!
1NFDA, National Funeral Directors Association; http://www.nfda.org/news/statistics
2CSG Actuarial Final Expense Report; https://www.csgactuarial.com/2015/10/liccsg-actuarial-final-expense-survey-report/
3U.S. Census Bureau; https://www.census.gov/prod/2014pubs/p25-1141.pdf
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