IC33 English Chapter 18 Notes

Chapter 18 – Life Insurance Selling Process

Two points that distinguish selling life insurance and selling other products:

  1. Firstly, it is said that ‘life insurance is sold, not bought’. In case of other products, the prospect has a need for the product and initiates the enquiry. In the case of life insurance, typically, the salesperson has to go to the prospect and induce the need to buy.
  2. Secondly, in life insurance, unlike other products, one is not selling a tangible product but an idea. It is a promise that would be realised only in the future.

Salespersons should adhere to a well-defined sales process with clearly sequenced steps as below:

  • Build up list of prospects
  • Quantify the list of prospects and rearrange the list
  • Fix appointment with the prospects
  • Gather information and do a need analysis
  • Prioritize needs
  • Recommend appropriate solutions
  • Handle objections if any
  • Sales follow through
  • Policy Delivery
  • After sales service

Selling as a profession refers to the act of inducing a commercial transaction. This is done by inducing the purchase of a product or service. Such an act is carried out with the intent of earning remuneration

Insurance agents are salespersons who seek to induce members of the community to buy insurance contracts written by the insurance company that they represent

Prospecting is the process of gathering names of people, who can be approached for a sales interview

Target markets for prospecting include:

  • Immediate group
  • Natural market
  • Centres of influence
  • References, introductions and testimonials
  • Other service providers

A professional, efficient method of selling on a group basis includes conducting seminars and events

An easy and viable means of reaching out to prospects on a mass scale include emails, newsletters, personal websites or blogs, social networking websites and so on “Qualified” prospects are those people:

  • Who can pay for insurance,
  • Who can pass the company underwriting requirements,
  • Who have one or more needs for insurance products and
  • Who can be approached on a favourable basis.

During a sales interview with the prospect, the agent should do a need gap analysis

In need gap analysis, we engage in a process of gathering detailed information about the prospect’s insurance requirements. This is to identify and determine the assets and perils for which there is inadequate coverage

After completing the sales interview successfully, the agent should design a solution based on the prospect’s needs and present the solution

The agent may handle client objections using the LAPAC (Listen, Acknowledge, Probe, Answer and Confirm) approach

Closing a sale involves persuading the prospect to buy immediately. While closing, the agent may use the ‘implied consent’ method or offer alternatives to the prospect

Once the sale is closed, the agent should do a sale follow-through and deliver the policy Service on the part of the agent is an integral element of the sales cycle. For commitment to service, it is necessary to have a structured programme for maintaining contact with our clients