What makes a good insurance agent

Lots of people choose the profession of an insurance advisor. Some people treat selling insurance as a part time vocation, while others choose it as a full time career. Irrespective of part time or full time nature of the occupation, there are some important attributes that successful insurance agents should possess. The traditional insurance agency model is facing a number of challenges in India as online insurance is being aggressively promoted and banks are partnering with life insurance companies to sell insurance products. However, the traditional insurance agents still have a very important role to play in the insurance business as they are catering to a large segment of the insured population and an even larger target segment that is uninsured or underinsured. It is imperative for insurance that they build deep client relationships in order to retain their clients, get a bigger share of their wallet and expand their business through client referrals. Here are some important attributes that make a successful insurance agent.

• Client centric approach:

  A client centric approach is absolutely essential to the success of an insurance advisor. The advisor needs to earn the trust of the client. The trust cannot be earned in one day and is built over a long period of time through numerous interactions that benefit the client. Advisors who put their client’s interest ahead of any other motivation are able to earn the trust of their clients. It is true that insurance agents earn their income from commission paid on the policies sold. However, the agent whose sole aim is to earn higher commissions regardless of the needs of his or her clients is unlikely to retain the trust of their clients in this day and age. Clients today have information on their fingertips and are far more aware about insurance products than they were 20 or 30 years back. If the client realizes that the agent sold him the wrong product, not only will he not retain him, but he will also advise his friends circle not to work with the agent. In this information age, word of mouth whether good or bad, spreads faster than ever before. The potential loss of future business weighs much more than the extra commission earned by selling the wrong product.



• High Emotional Quotient:

  Selling insurance is not easy. For the uninitiated clients, life insurance is an unpleasant topic because it involves mortality. Sales closure lead time is typically long in most insurance sales. Persistence is therefore an important attribute for insurance agents. An advisor cannot force a prospective client to buy insurance, but he can certainly reason with the client why insurance is critical for managing unforeseen risks. An important aspect of the sales process to empathise with the clients to clearly understand their situation and requirements. Good listening skill is an important ability to build trust with the client during the sales process. Many insurance agents are too eager to talk about various products and their features, rather than listening to the clients. It usually sends a bad signal to the clients who mentally switch off immediately. Secondly, unless the advisor understands what the client needs, he will not be able to sell the right product. Good financial advisors connect with the client at a personal level during the sales process. They try to understand the client’s financial situation, assets and liabilities, family situation, goals and aspiration. They identify the client’s needs even though the client may not have explicitly articulated or maybe not even aware of them. Connecting a client’s need to a product that helps the client meet those needs makes the job of closing sales much easier.



• Enthusiasm and integrity:

  Discussing life and health risks is a morbid topic. Insurance client needs to be convinced to buy life and health insurance or increase their cover to adequate levels. Advisors will not be able to convince clients if they have a weary or downbeat disposition. Insurance advisors must exude enthusiasm and confidence at all times. The advisors should also have a positive body language. Life insurance is prone to mis-selling. Rampant mis-selling of certain life insurance products a few years back led a furore in the media and among the public in general. Past experience and financial awareness has made many prospective clients very wary of life insurance products. Honesty and integrity is critical to long term success of an insurance advisor. The advisor should be honest about the policy terms, claims settlement rates, returns and risks (in case of ULIPs). In the case of Mediclaims, advisors should clearly explain the exclusions, waiting periods, cashless restrictions, co-pay clauses etc. Many clients do not read the policy document before buying the insurance policy. The advisor should ensure that the client reads the policy document carefully and understand all terms & conditions. The advisor should also be very transparent about his or her commissions, should the client enquire about it. An advisor’s integrity will build a reputation of trustworthiness, which is the most important trait in this business.



• In-depth product and personal finance knowledge:

  The insurance advisor should have comprehensive knowledge of the range of products sold by him. He should have information on all the product features and be able to explain financial impact in various scenarios with examples to the clients. If the advisor does not have the answer to a question off-hand, he should go back, find out the correct information and convey to the client, instead of giving the incorrect information. Insurance advisors should also educate themselves about their competitor’s products, so that they are able to compare and contrast different products and explain to the client why a particular is best suited for his or her needs. A good insurance advisor should also have a strong working knowledge of personal finance topics like risk and return, asset allocation etc. Life insurance and Mediclaim premiums qualify for tax benefits under Section 80C of income tax act. As such, insurance advisors should have a working knowledge of taxation, so that explain to the clients the tax benefit in quantifiable terms. Some insurance advisors earn professional qualifications like Certified Financial Planners to service their client’s needs better and also enhance their own personal brand. Professional qualifications can open up other channels of business for insurance agents.



• Customer service is essential to client retention:

  The importance of good customer service can never be overstated. The most frequent complaint clients have about financial advisors is that they are not reachable on phone when the client needs him. Insurance agents are often one man armies and have to juggle multiple priorities, like sales prospecting, sales closures and customer service. It is possible that at times, that the advisor is unable to attend a client’s phone call because he is busy servicing another client or attending some other urgent business. The advisor should call back the client as soon as he can or at least send a text message apologising that he was not able to attend the call but will call back the client within a specified time. It is absolutely essential for good customer service to keep promises because that is how trust is built. If a client commitment is too taxing for whatever reasons, then the advisor should set the client’s expectations accordingly. It is much better to under promise and over deliver, than to over promise and under deliver. Most of the customer servicing issues can be addressed through use of technology. The advisors should set up a calendar for premium payments and send automated email alerts to the client, using various online services (e.g. Google). Some online tools let advisors send automated text message alerts to the clients. Premium payments can be automated through bank ECS or credit cards through bill payment gateways (e.g. Billdesk). It saves the client and the advisor a visit to the office of the insurance company for premium payment.

Conclusion

In this blog, we discussed some attributes that make a good insurance advisor. Insurance buyers should look for these traits in an insurance agent. While the insurance business is challenging, there are numerous examples of insurance advisors who have built financially rewarding and professionally fulfilling careers. All it takes is hard work, discipline and perseverance.