Thursday, June 19, 2014

Why is Life Insurance a Useless Product?

In my first few years as an Insurance Consultant, the biggest challenge I face everyday is to convince my clients and prospects to look at a life insurance policy as a necessity!
Most of the prospects I've seen, bought a savings or investment plans. The most I could do is to convince them to consider a medical insurance plan to provide for emergency hospitalization bills. Sometimes, selling medical & health insurance plan is an uphill battle with certain prospects.
In financial planning, life insurance is always form the foundation of the planning process. Unfortunately, it's the most important product that is hardest to buy, because it's meant to be useless!
4 years back, I met a young account executive who just started working, and I go on to explain the importance of putting a life insurance in place for her. As she is young, it's so easy to convince her about taking this small step towards financial planning. With the lower income as a fresh graduate, I suggested for her to start a life + medical insurance at the lowest premium that she can afford and she can upgrade it later when her income increases. She was completely sold on the idea on our first appointment. However, she said she will need to talk to her mom on this matter.
One week later, when we met up for the application, she told me she agrees with me but her mother told her that buying a life insurance is totally useless. Thus, she have second thoughts about signing on the dotted line.
My reply to her was simple, "Aren't you glad that your mother told you that life insurance is useless?"
Shocked, she asks, "I don't get you, what do you mean?"
I look straight into her eyes and told her, "Nobody would ever buy a life insurance hoping it's going to be useful. And I'm sure you are glad your mother did not get to use it."
From that day onwards, I never had any problem selling this "useless" product anymore!
Life Insurance is meant to be useless because it's money given to you at the time you would need it the most, when you lose your job due to death, disability and diseases.


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