A shocking statistic that motivates clients to take action
Mohamad Manmohan Abdullah, ChFC, CLU
When I go and see someone to sell insurance, what answer will I get when I ask them, “Do you have life insurance?” The majority of the time they say, “I have it already. I bought it from so-and-so.” This is what I do: "Mr. Prospect, 90% of all policies sold here in this country will not deliver the way it should." That's going to shock them.
I will ask the prospect, "Why did you buy this policy in the first place? Any insurance policy is good, but why this particular policy and why this amount?" The prospect says, "Hmm, that agent is my friend,” or “That agent was referred to me,” or “That agent is a cousin of mine." So I tell them there's nothing wrong in having some insurance policy, but it is a living disaster for the beneficiaries if that's all they have.
Is your income protected?
The prospect still might not understand. I explain, "The idea of buying a life insurance policy is to make sure, No. 1, that your income is protected. How much of your income is protected?" Ask this question to your prospects and to your existing clients. Ask, "Should something happen to you, how much of your monthly income do you want to give to your family?"
Then you keep your mouth shut. Do not say anything. He will come back to tell you how much is sufficient. For calculation’s sake, let’s assume he says, "I want to give my family $10,000 a month." I respond, "Wow, that's a good amount. $10,000." I want the prospect to understand that the policy he currently has might not be sufficient and that I'm here to rectify that mistake and make sure his insurance policy delivers. So he tells me $10,000 a month and 12 months is $120,000. Then I ask a simple question like, "How many years do you want this income to be?" Let’s say it’s 10 years, you just multiply the figure and get $1.2 million.
Finding the coverage shortage
I am not even adding inflation in it because I want the prospect to understand what life insurance is all about. He's just like, "So what do I have now?" And that's where I start doing a review. If he's already my client, before I go and see him, I've done my homework and calculated how much he has. Let's say it’s half a million dollars. And I will say, “There's a shortfall of $700,000. Let's proceed with this.” Even if the person doesn't buy the balance of $700,000, he adds on some amount so that it will be something more. It works very well for me.
After I talk to the prospect about this, I say, “I told you that 90% of the policies sold will not deliver. I'm sure that's the same with your friends. Can you give me the name of your friends? Who comes to mind now?"
If he gives me a name, I ask for the person’s phone number to call them in front of the prospect. I call John and say, "John, good morning, this is Mohamad. I'm in front of Jim, your friend. We just reviewed his insurance policy. And you know, we found out that, just for information, 90% of all policies sold in this country will not work. Jim's policy was one of those. Now Jim has asked me to see you to review your policy because he doesn’t want you to be in that figure."
I'm asking for referrals at the same time.
Mohamad Manmohan Abdullah, of Kuala Lumpur, Malaysia, has been an MDRT member since 1996.
This article originally appeared in the MDRT Academy, which is a new association for financial professionals striving to reach MDRT-level production. Those who join get exclusive access to MDRT-member insights, gold-standard content and performance-driving features tailored to their specific need.