There are more than 300,000 insurance agents who occasionally broker financial products. Unfortunately, they are confused with the true independent financial insurance advisors, whose numbers are considerably smaller. Many of the misconceptions among potential customers between the two groups are the fault of the insurance financial advisors. That alone can lead to a significant number of lost customers and opportunities.
What does it take to add financial planner or financial advisor wording on a business card? Nothing. While liability litigation may arise, there is no law or ruling prohibiting the use of a financial planner or insurance financial adviser on your business card, letterhead or mailings. Look at the word advisor. Wasn’t it the Association of Life Insurance Underwriters that changed its name to reflect both financial and advisor? Therefore, it is up to you to emphasize what your knowledge is and what sets you apart from the crowd.
Brochure Promotion Here’s a warning. It is wise to print a brochure promoting your designations, your associations and your achievements in general. While people love doing business with a knowledgeable expert, they hate doing business with someone who projects themselves way over their prospect. Keep a brochure sincere. One whose content is formulated in such a way that anyone with an eight-year reading level can understand it. Never make it sound like a political campaign speech, as many of your employees do.
Tip: Write your personal brochure about Microsoft. Then go up and select tools. Select spelling and grammar. This also provides suggestions for sentence structure. In the summary, you will see the Flesch reading ease at the very end, preferably around 50%. More importantly, the Flesch-Kincaid Grade Level should ideally be 8.0 to 8.6.
Emphasize your diversity Agents representing only one company can simply push products with the highest commission without the customer’s knowledge. With your independent insurance advisor contracts, you need to develop a plan that is beneficial to the customer and yourself. Pass this information on to your client, who will appreciate your honesty. Another hint: over 85% of independent financial insurance advisors are NASD-licensed. On the other hand, with “insurance advisors” that are not independent, less than 40% are NASD-licensed. If you’re really into financial planning, as you know, it takes a combination of products to meet a customer’s needs.
Times change In terms of financial advisor income, stockbrokers and planners affiliated with captive broker-dealer firms consistently had the highest annual income on average. The insurance-oriented financial advisor follows at about 20%. Far behind are the hundreds of thousands of novices to experienced insurance agents who call themselves financial advisors and planners. With a rapid downturn in the country’s economy, a chill has been sent down the stockbrokers and broker-dealer firms. Besides ridiculously charged products, they run and further margins. The pressure on these advisors is increasing while incomes are falling.
New competition As always, you’ve had competition from stockbrokers style financial advisors. Like you, they are NASD licensed. Unlike you, they have very few life companies and life insurance products to use. With tight economic times, the profit margin on non-insurance products has shrunk sharply. The economy may be in limbo or suffering, making your insurance-backed annuities much easier to promote and sell. Watch as skilled captive stockbrokers and captive advisors seek their independence and find insurance as a profitable base to start their planning.
Silver lining Having more time means more customers and more revenue. If you are truly an independent insurance financial advisor, you can outsource almost every facet of your advisory services. Customer contact is of course not part of that, you can never get enough of that. Modern technology is developed rapidly, so you spend less time monitoring and even creating your product portfolio for customer planning. Plus, if you haven’t noticed, the broker-dealer tyranny days are starting to end. This means that moving from one independent broker-dealer to another, along with all your bills, will be a piece of cake. This leaves much more time for assessing insurance, including the need for long-term care insurance.
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