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Advisors in Mexico see increased interest in financial planning

Elizabeth Diffin

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Financial advisors see opportunities for growth as perceptions change in Mexico.
One word comes to mind regarding the financial services industry in Mexico: opportunity.

While the country’s economy has suffered losses in recent years, it has emerged as an influential force in purchasing power parity. And financial advisors see great potential for growth, particularly in the up-and-coming life insurance sector.

“Mexico is a country that has lacked a culture of insurance for many generations,” said Litzie Riveiro, a six-year MDRT member from Mexico City, Mexico. “Selling life insurance in Mexico represents an amazing challenge because of long-held cultural negative perceptions of life insurance and insurance companies.”

"Mexico is a country that has lacked a culture of insurance for many generations."
— Litzie Riveiro
Rodolfo Olea Patino, BBA, MBA, a three-year MDRT member from Los Cabos, Mexico, notes that in Mexican culture, it is not typical to plan for the long term, so something like life insurance is viewed as unnecessary. In addition, children are usually expected to care for their parents in old age, so retirement planning is considered equally inessential.

“In my country, there is not a strong culture of personal finance,” Olea Patino said. “The average Mexican goes day by day. Mexicans are not used to planning long-term; they hardly plan vacations, let alone plan their retirement or think to leave their family protected in case of death.”

David Fitz Ocampo recognizes this same tendency, which is why his practice in Mexico City focuses on millennials between the ages of 22 and 28.

“My goal is that from a young age, clients reduce their financial risks through structured financial planning,” said Fitz Ocampo, a three-year MDRT member from Mexico City. “I decided to specialize in millennials because I am one of them and I understand perfectly their current situation and the importance of having life insurance at a young age.”

To that end, he focuses on reducing his clients’ financial risks throughout their lifetimes, encouraging them to save for the future rather than spending on shorter-term lifestyle needs. Riveiro faces similar challenges in her practice, especially when it comes to the cultural resistance to life insurance products.

“Clients usually put off the acquisition of life insurance or retirement plans because they might think of them as intangible,” she said. “They would rather invest in real estate or any other tangible product.”

She remembers a 37-year-old client who was very resistant to purchasing a life insurance policy, especially because he had recently been given a clean bill of health. But since he had young children, Riveiro worked to convince him that having a policy would be wise, even going so far as to call him while she was vacationing on New Year’s Eve to urge him to reconsider.

The man appreciated her persistence and decided to purchase a policy. Eight months later, he died of a heart attack at the age of 38, and his wife was able to use the life insurance money to pursue a medical career.

“I always try to visualize the prospect as my own family and focus on getting to the core of their concerns, needs, values, dreams, economic possibilities and retirement goals,” she said. “Then I work on the idea and figure out which products fit the prospect’s needs, not the other way around.”

Similarly, Olea Patino said that in his practice with his wife, Lourdes, the focus is always on the clients and the clients’ needs, not on how much money they personally could make.

“We never make a recommendation based on our own interests,” he said. “Regardless of commissions or bonuses, if we recommend something, it’s because it is the best for the client.”

Perhaps that is why his practice has taken on a unique coverage niche: hurricane insurance. Olea Patino’s home in Los Cabos is located on the Pacific Coast of Mexico and was ravaged by Hurricane Odile in September 2014. It took months for the area to recover. Olea Patino watched as clients used their savings or took out loans to repair their homes and businesses.

“What I learned from this experience is that when there is an economic crisis, people need us more than ever,” he said. “Maybe they cannot think about savings plans at that moment, but when a family or company is going through a difficult financial situation, it’s when they most need the protection.”

So Olea Patino has taken on the challenge of providing hurricane insurance, a highly specialized area that requires extensive training and education. But this desire to rise to new challenges is consistent with his approach to other areas, such as technology.

“The use of technology is dramatically changing the industry,” Olea Patino said. “These changes will benefit the insurance companies, but advisors must be prepared to face those changes. Those who don’t will pay the price sooner or later.”

Riveiro agrees that adapting to changes in the industry is essential for survival.

“Huge technological changes have pushed the industry into constant reinvention,” she said. “Technology and electronic devices are now part of people’s everyday lives and clients demand faster processes, available information at hand, updated apps and platforms. In the next few years, millennials will mark a change in the industry; it is essential to acquire the appropriate tools to cater to this new generation.”

Litzie Riveiro

Rodolfo Olea Patino

David Fitz Ocampo

"What I learned from this experience is that when there is an economic crisis, people need us more than ever."
— Rodolfo Olea Patino

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