Advisers should be passionate about income protection to properly engage customers.
But they should also resist talking down to customers and bamboozling them with jargon or seeing the benefit as purely a bolt-on.
These were some of the key themes discussed by The Protection Coach, Matt Chapman (pictured), on the second day of Income Protection Action Week (IPAW).
His comments followed four roleplays – the first jargon-heavy, the second dour and lacking any life, the third condescending and the fourth where income protection was seen as an optional extra.
Avoid bamboozling customers
Analysing the first roleplay, Chapman explained the example failed to identify the core needs of the customer, with lots of terminology, industry speak which bamboozled and confused the customer.
“There was just a distinct lack of process,” Chapman said. “There was no start or finish. It was a general conversation leading nowhere.”
Consequently, Chapman identified action points to take the client conversation further.
“Relate it back to the customer’s goals,” Chapman explained.
“Establish exactly what it is they’re hoping to achieve from your advice in the first place. And then really create the need around income.
“How does income play in the whole advice conversation? What is the income being used to do? Is it for example in this scenario that income is being used to get the mortgage? Look at the number of mortgage repayments that are going to need to be made.
“Go through the budget plan with the customer. Create that core need throughout the conversation.”
Reminder of what their income is used for
Chapman added customers also need to be reminded that their income is what is being used to get the mortgage in the first place.
“Focus on that core need before you start jumping into the technical elements of the product,” Chapman said.
“You’ve got to get the customer to buy in first around the concept of what it is, why you’re doing it and that need for income and how it relates to their goal, before you start talking technical.
“Naturally, we’ve got to avoid using very complex explanations of the product initially.
“The idea is to use very simple examples. I’ve referred to income protection in the past as your own private furlough scheme.
“I also encourage advisers to think about using examples of how the benefit would actually be used – to keep the lights on, stock the fridge or keep you in the home.
“Because conceptually most people have this optimism bias so they don’t think they’re going to need to rely on these products in the first instance.
“When you get down to those core objectives, it’s about doing those key things that people need – not just bombarding them with too much information. Allow them time to process to understand what you’re doing and act a bit more assumptively.”
Using information at your fingertips
Following the second roleplay depicting a dour client conversation, Chapman urged advisers to use the information they have at their disposal about the customer.
“We collect a lot of information about the customer, and I’m not suggesting we weaponise that at all,” Chapman said.
“What I’m really saying is you’ve got everything at your fingertips – all the information about the customer, what they care about, what they choose to spend their money on.
“Delve into that with the customer and get a little bit of feedback from them as to what they care most about.
“I often talk about being an ACE adviser – ask questions, establish concerns and then educate.
“The problem is most advisers ask questions, establish the concerns but forget the education bit.
“Be human. Educate the customer as to how it’s going to help them with the things that they care most about.
“The other thing is not being afraid to let your personality shine through. Advisers are often very worried about being themselves in these types of conversations.
“The human element is quite endearing and it’s probably what’s going to get the customer to be more bought into what you’re saying, because they see you’re also a human.
“You’re not just going through the motions. It’s not just a process. It’s a genuine conversation where you’re looking to produce good outcomes and you care about what’s going to happen to the customer.”
Importance of storytelling
Chapman added storytelling really is imperative to bring the message home to customers.
“Storytelling is imperative,” Chapman continued. “Storytelling is how we bring these things to life with people.
“We can all recount genuine stories where we have seen customers suffer hardship or go through things.
“Everybody out there has probably known someone that has experienced a serious illness or died prematurely.
“I think it’s about reverting to those stories and even probing the customer as to whether they know someone in that situation, because invariably they will.
“Often it’s enough just to spark that thought in their minds as to what happened to that family, because they will see the benefit of what you’re recommending.”
Have conversations not presentations
Chapman added a key problem with this example was that it was more like a presentation than a conversation.
“It’s a very cold interrogation rather than an actual conversation as to what’s going to benefit them,” he continued.
“I think that’s what’s advisers need to avoid.
“I understand, particularly if you’re one of those advisers that’s working through a script, it’s very easy to sound a bit monotone. So for those advisers that are heavily scripted in the way they do things, just add a bit of your personality into the conversation.”
Avoid condescending conversations
After the third roleplay, Chapman called on advisers to avoid being condescending with customers.
“I hope these conversations aren’t talking place,” Chapman said. “Unfortunately, I have in the past heard a couple like this.
“I think the problem and what’s going in this particular case study is you’ve got an adviser who misunderstands their role as an adviser.
“You’ve got advisers who believe that the value of what they do is that they know something the customer doesn’t. It’s like you’re paying me or coming to see me because I’m an oracle in this situation. So I’m going to chat to you in a very condescending way and assume you don’t know what you’re talking about.
“I understand why – because we don’t learn about money at school. This is why we have optimism bias and all these other issues because we don’t understand money. We don’t learn it at school.”
Role is to disseminate information
Chapman added the role of the adviser is to disseminate information and not be condescending to customers.
“I personally believe that the role of an adviser is actually to disseminate,” Chapman said.
“The role of the adviser is to do the education bit that sits behind it. I think this case demonstrates very easily how an adviser can assume the role of an authority figure without understanding that their role is not to assume what the customer doesn’t know and use it against them – but to actually break down that knowledge gap.
“And it’s only when you’ve done that educational bit that you’ll get the client truly engaged with what you’re trying to suggest – because it appears that you’re doing it for their best interest.
“It’s not that you’re trying to pitch or sell a product that you know about and they don’t.
“The condescending approach is unpleasant to watch. Very unpleasant.”
Avoid seeing income protection as a bolt-on
And finally, following the last roleplay, Chapman urged advisers to resist discussing income protection as a bolt-on.
“I see this an awful lot in my coaching work,” Chapman said.
“Generally speaking, most people have a pre-conceived idea that the customer has come to them for something else.
“We’ll use mortgages as an example where you speak to advisers and they say the customer came to me looking for a mortgage not for protection.
“I have to educate them and tell them actually, the customer did not come to you for a mortgage. The goal is something else entirely – to buy a home.
“The mortgage just happens to be the product or solution to achieve that – in the same way that the income that is being used to get the mortgage is something that’s also being used.
“The mortgage is the means to an end. The goal is to not to get the mortgage. It’s to buy the home.”
Focussing on customer need not what advisers think they want
Chapman added that the challenge in these sorts of situations is where the adviser is too focused on what they think the customer wants.
“The problem is when you do that you almost side-line protection and income protection in achieving that goal. Then when you do bring it up, it starts to feel like a sales pitch,” he continued.
“Like if you’re a customer and you’ve just bought something and someone says, have you thought about the optional warranty?
“The first thing you do is shut them down because you feel you’re being persuaded.
“But if someone says to you, as part of this advice process we’re going to be looking at getting you a mortgage but also to protect the very means that allow you to get the mortgage and repay it – given the goal is to buy the home.
“So establish the real core goal with the customer and then explain the various elements as to how you’re going to achieve that.
“That’s a different way of doing it.”