Did You Know?
True Feelings About Life Insurance Quiz!

Did you know that you and your clients can take a short quiz created by the Life Insurance Management Research Association (LIMRA) International to help you and your clients identify how you and they manage risk and make important financial decisions?

We all know that most consumers find buying life insurance to be a tough decision because it is a combination of rational financial calculations, emotional attitudes and nervousness about buying the right product for their needs. LIMRA developed the quiz below “based on the science of behavioral economics, a field that combines psychology and economics,” said president and CEO of LIMRA Bob Kerzner.

Use this easy five question YES/NO quiz with your clients to help you help them with their life insurance buying decisions.

What does the science of behavioral economics tell about the answers? The LIMRA research revealed five findings that can play a large role in individual financial decision-making. Compare these findings with the answers given by you and your clients to the questions above. Ask yourself and your clients which, if any of these have played a role in your/their decision to buy – or not to buy life insurance in the past?

1. Premature death is both unpleasant to think about and a low probability, so people tend to assume it won’t happen to them, even though the financial impact on their family could be great. This can be a reason not to make a decision to buy life insurance.
2. Buying life insurance can be complicated. If the “cost” of getting information, in time and effort, is too high, people will put it off and not make a decision. Interestingly though, talking about it with friends and family seems to help reduce that “cost” and people will often copy another’s decision to buy.
3. Oddly, people hate to lose much more than they like to win. The pain of loss is more than twice as powerful psychologically as the pleasure of gain. People tend to think of insurance premiums as immediate “losses” and undervalue the possible future “gain” of a life insurance payment should they die prematurely. This can be another reason not to make the decision to buy life insurance.
4. People are usually willing to spend only so much on insurance – their insurance “account,” as it were. They may focus mainly on home, auto, and health and decide they “can’t afford” more insurance and fail to adequately insure their life.
5. The final decision to buy life insurance is partly emotional. Three key emotions involved in the decision are 1) regret, 2)fear, and 3)love. Suppose you were diagnosed with a terminal illness. Would you “kick yourself” if you had not bought life insurance before getting sick? That’s regret. How worried are you about the possibility of premature death? That’s fear. Would purchasing life insurance express your strong feelings about your family? That’s love.

Understanding the emotions involved and the nervousness about buying the “right” product (question # 2) will go a long way to improved sales results, but only if you remember to use the KISS formula ‘Keep It Simple Stupid’. Any life insurance solution that is not term insurance requires a “kitchen table talk” simple conversation with no technical jargon that focuses on that “what’s in it for them” benefits and features of how a permanent or Universal Life product matches their identified needs. If you lack the tools or training to have that simple kitchen table conversation, you’re in luck. They will be available to you shortly from Insurance Know-How’s store.

Cheers, Helena

p.s. Insurance Know-How’s Store will have lots of easy to use products and templates that will dramatically improve your insurance sales results!

p.p.s. Are you adding a family protégé to your practice? Don’t struggle with training; hire a training and coaching professional! Click here to learn more about Insurance Know-How’s new Family Matters programme.

Tags: quiz, sales tips

This entry was posted on Wednesday, January 11th, 2012 at 9:00 am |