Insurance protection: Talking tragedy vs. dreams

How far should an advisor go to persuade clients to take planning seriously?

Do you appeal to the rational brain with numbers that show the gap between loss of income and what survivors will need to keep their standard of living? Or do you tug at the emotional with scary stories about how death or illness can disrupt their lives without proper coverage? Advisors have no shortage of experiences with prospects and clients who, after being presented a compelling case for buying insurance, walked out the door, often promising to think about it but ultimately rejecting the proposal because they’re in good health and think they don’t need it. Then that person died or sustained an illness or injury that rendered them uninsurable.

Twyla Dawn Hardham, CFP, has seen the “disconnect” when recommending critical illness insurance. “I hear people say, ‘It’s not going to happen to me,’” said the seven-year MDRT member from Kelowna, British Columbia, Canada. “If you present a tax-shelter strategy or a return-of-premium strategy, they’ll buy in, but I don’t get buy-in because they think a critical illness isn’t going to happen to them.”

Even if there is buy-in, what if there isn’t a commitment? Darren W. Ulmer, CLP, CLU, had a client who was dithering on writing a will. Knowing that years before this client had a falling-out with his siblings regarding the inheritances from their parents’ estate, the 15-year MDRT member from Saskatoon, Saskatchewan, Canada, asked him when he last got together with his brothers and sister for a holiday dinner. “We don’t,” he responded. “Do you want that for your kids?” Ulmer asked.

The client, a farmer, was now onboard but wanted to continue the discussion after harvest season. Weeks later, he suffered a heart attack while working in the field. He survived, but the proposed plan was scrapped because he was uninsurable.

“He scared himself into doing it, but the timing wasn’t right even though the money was in place. My failure was just not being aggressive enough to say, ‘All right, let’s do it right now,’” Ulmer said. “We do our best to remind clients that we are their advisors, not their convincers. Ultimately the decision is theirs, and I explain to them the importance of the time is always right in the moment we are in now because no one can guarantee your health tomorrow.”

What is effective for Ulmer is sharing his own story of being a cancer survivor and how his coverage enabled him to create memories by taking his children to Disney World and paying to install a gourmet kitchen for his wife. “I talk about the (payout) in that way rather than saying, ‘Well, I got the money, and you should have it too,’” Ulmer said.

There is a delicate line between coming on too strong and being too soft. Chris George, CFP, TEP, an 11-year MDRT member from Vancouver, British Columbia, Canada, used to prompt his clients to envision nightmare scenarios by asking, “What would happen to your family if you were hit by a bus today?” While his closing rate increased, his commissions declined. So did his referrals. Who would want to refer relatives and friends to someone who created stress and anxiety for them?

“If I don’t enjoy talking about my own death and illnesses, why would I expect my prospects to?” he said.

George switched gears by positioning insurance as a positive tool to prepare for the most likely of circumstances — staying alive and healthy. Planning enables clients to set positive goals and dream about a bigger future as they approach retirement instead of what disasters could be lurking. “It makes little sense to prepare only for the least likely events to occur and not for the most likely.”

Still, there is potency in making prospects and clients uncomfortable enough at least to consider protecting their financial future rather than outright scaring them.

“I think it’s important to talk about what if something happened to you yesterday or the week before, because people would have to think about it as if it happened,” said Simon John Gibson, Dip PFS, a 25-year MDRT member from Burwell, England, UK. “I always say, ‘What if you retired yesterday or last week? What if you died yesterday, or you got married and had children yesterday?’ That makes people actually envision themselves in that position and what they would need right now. If it’s any time in the future, decisions can be put off.”

Stories enable advisors to insert clients’ own circumstances into a scenario and sell what life insurance can do for them. “When they see you’re passionate, that’s when they kind of start getting it,” said Terry C. Johnson, a 12-year MDRT member from Windsor, New South Wales, Australia. Among his library of stories is one about his father, Tom, dying from a heart attack at age 43. There was no life insurance, and the family business was heavily leveraged by borrowing against personal assets, all of which were sold at a fire sale when the loans were called in. Then Johnson’s mother moved in with relatives, his two brothers moved in with girlfriends and he lived in a garage for a time. 

“I would suggest that you actively get involved in all claims, as this is when you truly understand the power of what advisors do. Being involved enables you to build a library of claim stories, which allows you to be totally transparent and passionate, and prospects will see this in you. It’s definitely not about numbers, figures and data. It’s mostly about emotional stories that seem to work for me,” Johnson said.

Filling the gap with a story

Shortening the distance between advisor and client can be a matter of understanding the psychology behind strategic storytelling, said Kindra Hall, chief storytelling officer at Steller Collective and a 2022 MDRT Annual Meeting speaker. Stories have the innate ability to illustrate value. Her strategies for finding such stories include the following:

• Make a list of the bullet points you often talk about, and which stories show those features in action.
• Make a list of clients. Jotting down their names can unlock stories.
• Make a list of what clients care about. Knowing what makes them hopeful or keeps them up at night can unlock stories they need to hear.
• Make a list of lessons learned the hard way. Being transparent about the hard lessons you learned can build deeper connections with clients.
• What are your stories? People want to do business with people they know.

“What humans actually say yes to — especially when you are selling something that is invisible — is the story of what something will mean in their life. So, if you have ever sensed a gap in your sales, it’s because you’re probably missing some of the stories prospects need to hear that make the yeses so much easier,” Hall said.