What is the best insurance available?One of the common questions asked by customers
Almost all persons would ask the above question when considering an insurance plan. Most agents would just take out their sales kit or brochures and just present the customer with a few options with varying in costs and features. The customer may then purchase the policy because it is conveniently available at that time or probably the agent is a relative or a friend of the customer. It is definitely not wrong as having a coverage is definitely better than having no coverage. But the question of concern is whether it is the ‘best’ insurance policy for the customer? Did the customer in the end able to confidently say ‘Yes’ that they had decide on the best insurance available?
We do not know, yet.
However, as an advisor we often tell our customers, “We do not know, yet.” For that moment, they would feel slightly surprised and we may seemed to be incompetent. However, that should be the most appropriate answer for that moment.
For an example, you plan to visit a nearby clinic due to feeling unwell. At the very first contact when you meet the doctor, would you ask the doctor what is the best medicine to cure your sickness? I am sure that would not be the case. However, if you do ask that, the doctor’s reply would be ,”I do not know but let me ask you how are you feeling unwell? Are you having any pain?”. The doctor would try to fact find in what way you are feeling unwell. After the examination, the doctor would then examine and diagnose the situation. The doctor would then prescribe you the appropriate treatment.
Medical Doctor’s Process
- Fact find – your situation
Engineer the most suitable Insurance
Similarly for a situation where someone would want to purchase an insurance policy. We would fact find by asking the person the purpose, current financial situation, dependents and health conditions. By providing these key points, we would then examine and then to ‘engineer’ the most suitable insurance policy. To use the term ‘engineer’ is very relevant as insurance policies today are considered complex for the common public. It can be configured with specific coverage and amount to be packaged together in the main insurance policy. Hence, the most suitable insurance could only be derived from a process similar to the doctor’s process of assessing the situation.
CFP’s Advisor’s Process
- Fact find the customer’s situation and objective
- Examine the facts
- Configure aka ‘Engineer’ the policy
- Propose you the best solution
You are not purchasing your McDonald’s Combo Sets
You definitely know your McDonald’s combo sets. Furthermore, you even know what add-ons to buy and what to remove. This because you understand the product very well. However, your insurance policy is not an average McDonald’s combo set. Hence, our take to the advisory process is very important.
By having the advisory process with the customer, the advisor would understand the end in mind of the customer. More importantly, we want the customer to be guided to the path of having the most suitable insurance policy that they could buy.