I speak with agents all the time who have the drive and the skills to crush this business, but there’s 1 thing that’s holding them back – MONEY!
Selling life insurance over the phone takes a healthy monthly budget. The moment you stop investing in your business is the moment you don’t have one.
Keyword here being “investing”. Those who spend the money consistently every month on marketing are the one’s growing their business every month…go figure.
If you don’t have a healthy monthly budget set aside for marketing or leads, I would delay entering this business. You’re setting yourself up for failure unless you have a consistent referral source or other sources of income.
Agents who are balking at spending money on leads and/or marketing need to understand this is a big boys game. If you’re questioning yourself or have limiting beliefs, do yourself a favor and look at another industry. Harsh words, but I’m doing you a favor.
The majority of agents I speak with are bootstrapping together a life insurance business. I want to bring up some common mistakes many agents spend their money on in the beginning.
- Paying for a nice looking website.Great! But how does that bring you business? Unless you plan on putting consistent marketing dollars into promoting it, you’re just wasting your time. I can’t tell you how many agents have great looking sites they’ve spent $500+ for, yet they don’t have money to buy leads. It’s a waste of money when you’re just starting out.
Instead, take a few hours to register a domain name, buy hosting and upload a wordpress template as a 1 page website to use with a professional email address. If you think a 1 page website is unprofessional, that’s just a limiting belief you have. I have an agent selling 100% over the phone placing $10k+ every month with a 1 page website. Expand your website when the commissions warrant it.
- Paying for a CRM.There’s no need to pay for a CRM if you’re just starting out.
Instead, use an excel spreadsheet to keep track of your prospects. When you’re ready to invest in a CRM, every single one of them can import your clients from your excel spreadsheet into their system. Don’t waste time or money setting one up until you have a consistent sales funnel. This time and money should be spent selling in the beginning.
- Buying Life Insurance Leads BlindlyI can’t tell you how many agents I’ve spoken with who are broke and have a sour taste in their mouth because of bad lead purchases. I believe that 95% of life insurance lead companies send us mostly crap. From the way leads are generated to the way they’re distributed, it can never be a long term winning proposition for an independent agent.
Instead, leverage the knowledge of successful agents who are actually selling life insurance over the phone. I’m an open book and have a pulse on production from other independent agents. I know what’s working and what’s not working.
Don’t get me wrong, a website and CRM are all part of selling over the phone, but your #1 priority in the beginning is writing new business. Wait until you absolutely need these things. You should be spending all your time and money on leads/marketing. Give yourself the best shot from the very beginning. If you’re sales are consistent, you’ll know when you NEED a CRM or nice website.
Every business (not just life insurance sales over the phone) survives off of sales and marketing. This takes MONEY.
I can take a brand new agent and show them how to get 3:1 on their lead money from the get go if they’re willing to put in the work. Sounds good right? Not so much for those with small monthly lead budgets.
Lets say you want to spend $1k per month on leads/marketing which some think is a decent budget. Using the 3:1 ratio – you’ll make $3k. $3k (commissions) – $1k (investment)= $2k. Factor in the average lag time of 8-10 weeks before being paid this $2k and it’s not so attractive anymore.
This is why I only train agents 1 on 1 with at least 4 months worth of lead money (I recommend 6 months though) and a minimum $1500 monthly lead budget. Anything less and your income won’t sustain or motivate you to keep going.
I know that I scare more people away from this business than I attract saying things like this – but it’s the truth.
The good news:
Your 3:1 ratio will get better. You’ll increase lead/marketing investments every month once commissions start rolling in. You’ll earn more income every month once you get your systems down and become more efficient. Once it’s truly a plug and play business for you, that’s when this business becomes really fun and income takes off.
It all starts with getting a good start and investing in your business. Those who invest wisely and work hard will get there.
Those of you considering this business – save up as much as you can before entering. Like any business start-up, you’ll need working capital to get off the ground.