Selling insurance is challenging. Your clients have pre-conceived notions which create a mental blockade. This blockade tests your selling skills. You have to handle customer’s objections and bust some popular myths to sell a plan.
Though customers have pre-conceived notions about all forms of insurance, when it comes to life insurance, the case is worst. Customers have a lot of myths pertaining to life insurance. You need to have tact and wisdom to handle these myths and show the correct picture. Here are 5 top myths which you are likely to come across when you pitch life insurance to your clients –
- Life insurance is not worth the investment
Individuals believe that life insurance premiums are expensive and they do not justify their returns. That is why they do not believe life insurance to be a worthy investment avenue. Tell your clients that life insurance is not an investment. It is a security which you buy for your family’s financial stability. Life insurance plans are meant to create a corpus in case of an untimely death. It should not be viewed as an investment. When it comes to costs, term life insurance premiums are minimal. One can buy a higher coverage at very affordable premium rates. The plan promises financial compensation to the family which has lost its bread-winner. Thus, the plan provides your client’s family with financial security even in their absence. Doesn’t this security look like a worthy investment?
- Medical underwriting is just a formality
Clients believe that providing their medical details, both past and present, in the proposal form is not very important. The medical underwriting carried out by the company is just a formality and it doesn’t affect their proposal. They are wrong. Medical underwriting is an essential part of the underwriting process which determines whether the policy would be accepted by the company or not. If an individual is found to have a high health risk, the proposal is either rejected or accepted with a higher premium. So, you should make your clients understand that their medical data is important for the company. They should therefore, furnish the information correctly else their claim might get rejected.
- Insurance companies do not pay a genuine claim
Many customers feel that insurance companies do not honor their part of the bargain. At the time of claim, companies cause disputes on some technical matter and reject the claim. Fearing this claim rejection, an insurance policy is avoided. Your customers need to know that claim rejection happens only if they hide some important information from the company which influences the company’s underwriting decisions. If your customers are honest at the time of buying the policy and fill the proposal form correctly, claims would not be rejected. So, ask your customers to be true and clear when filling their proposal form, promise to give them assistance at the time of claim and you can bust this myth easily.
- Stay-at-home parent doesn’t need life insurance
This is particularly believed by husbands who are the primary bread-winners of their family. They believe that their wives, who are stay-at-home moms, don’t need an insurance cover. They are wrong. While home-makers juggle various duties, they are not paid a dime in salary. According to a recent article in the Economic Times, the salary of a home-maker is about Rs.45, 000 a month considering the various roles she plays (Source: https://economictimes.indiatimes.com/news/economy/indicators/how-much-salary-should-a-homemaker-get/articleshow/61761686.cms ). What would happen when those stay-at-home moms or dads die prematurely? In her absence, wouldn’t there be a financial loss? There would be as individuals would be required to appoint full-time nannies, maids and other professionals to do the work which the homemaker did free of cost. So, even for stay-at-home parents, life insurance is a must.
- Term insurance is cheap. Why hurry?
Perhaps the USP of a term insurance plan is its cheap premiums. While it is true that term insurance is cheap, procrastinating only makes it dearer. Want to know how? Age plays an important role in determining the premium amount. As age increases so does the premium rate. Moreover, in older ages if there are any medical complications, the premiums are further loaded to compensate for the higher risk taken by the insurance company. Both these factors increase the premium. That is why, it is always advised to buy young. Make your clients see the comparative advantage of buying a plan early and bust this myth.
Customers believe in myths as they have little knowledge about insurance. It is your job to break these myths and show your clients the correct picture. You have been educated about the common myths which associate a life insurance policy. Arm yourself with the knowledge and educate your clients too. You wouldn’t have to worry about your sales volumes.
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