Top Sales Trainer Says: Insurance Selling Is Stymied By Risk-Averse Recruiting Strategies

If you look at one of the great backwaters of the selling profession, it has to be the insurance industry.

It hasnt altered its recruiting and training practices for a century, and it is unlikely to do so anytime soon, because its very product is risk aversion.

Insurance, as everyone knows, is about pooling risk. Actuaries work long and hard to determine how many claims will be filed during a given period, and then they adjust rates to reflect those risks and to garner a certain profit.

When it comes to recruiting new agents, actuarial thinking also comes into play.

Knowing that a certain percentage will wash out, insurance executives do what they can to minimize the costs of these accidents, these claims against profits, if you will.

So, they shift the cost of failure to the trainees themselves by offering straight commission positions or the tiniest subsidies they can get away with offering.

For example, one company will not pay for its new Life and Health agents licensing training, right away.

Theyll reimburse the fees, but only after the newbie has earned $6,400 in commissions.

But the training only costs about $300- $500!

How many recruits do they discourage from ever signing on because of this stinginess? Its hard to tell, but definitely some.

Insurance companies are notoriously weak when it comes to recruiting successful salespeople from other fields, because they believe, without substantiation, that insurance selling is unique, and that success in other fields is not transferable.

So, they wont pay a top earner from, say, a mortgage brokerage business to move into insurance. That person will have to do exactly the same things at the same rates of pay as complete novices, a decade or more their junior.

The inbreeding in the insurance field is not an embarrassment, as it should be, but is underscored as a strength.

Companies will boast, Every one of our executives started as a field agent! without realizing this is an indictment, one of the primary reasons new ideas in selling and in motivation, compensation, and management find it so hard to penetrate this industry.

No wonder the biggest threats to conventional companies and their profits are coming from upstarts that are dispensing with typical agents and salespeople, opting instead for

direct marketing models.

Look for this trend to continue as long as the old guard insists on using the dead hand of the past to steer its course.

Dr. Gary S. Goodman is the best-selling author of 12 books, over 600 articles, and the creator of numerous audio and video training programs, including "The Law of Large Numbers: How To Make Success Inevitable," published by Nightingale-Conant-a favorite among salespeople and entrepreneurs. For information about booking Gary to speak at your next sales, customer service or management meeting, conference or convention, please address your inquiry to: gary@customersatisfaction.com.

Selling Styles - Men Vs Women
In my years of recruiting, training, and managing sales teams I was fortunate to have worked in both male and female dominated sales organizations. This article was written to identify the best of both styles and more importantly - the benefit of in...

Marketing Vs. Sales
Marketing and sales co-exist and work in tandem beautifully if they are allowed to remain as separate entities coming together to achieve results:DRIVING REVENUE!!Marketing = SIZZLE ------ Sales = CLOSING...

Successful Sales Strategies: Winning the Close Ones
The Three Cs in building customer relationships are a key component of professional selling skills.Indianapolis, IN (PRWeb) November 23, 2003 The deal is coming down to the wire. The buyer perceives the competitors solution as marginally superior, ...

Successful Sales People Know Which Differentiators Matter
Know where to focus. Not everyone evaluates product solutions with the same decision criteria.When sitting toe-to-toe with a prospective client, how well do you answer the question, What sets you apart from your competitor?Tom Snyder, vice president...

Sales Training Tip #11; Prospect Interest and Sales Process
It is important for teach each and every sales trainer and sales training manager of any company with a large sales force to make sure that each and every salesperson that is on the team so they can recognize when a prospect is interested in what it ...

Training And Coaching For Inside Sales And Customer Service Staffs Is Vital To Business Growth
When you are trying to grow your business during those first few years, the ability to turn prospects into customers and to keep customers satisfied with your products and services is MISSION CRITICAL.However, some entrepreneurs and small business ow...

Apply To This Job Now! While Supplies Last… (Not Available In Any Store!)
If you are a night owl like me, then you have a love/hate relationship with infomercials. If you are an impulse buyer and you cant sleep, well its a perfect time to evaluate the hidden treasures presented to you by celebrities and pitchmen. On the ot...

Sales Performance and Motivation: How to Get Your Edge Back
Performance and motivation are like chocolate & peanut butter; the combination is better than either one alone. Motivation feeds successful sales performance, which in turn generates increased motivation, which encourages performance, and so goes the...

Improve the Efficiency of Your Business with Sales Training Programs
Proper sales training is crucial for the success of any business! The efficiency of your sales depends on various interrelated factors such as the efficiency and the skills of your business members, the ability of your company to create and explore n...

Sales Training Consultants
Sales training consultants play a pivotal role in determining the personal selling objectives of a firm. The first task in sales management is to determine the place of the selling personal in the marketing mix of the firm and to set the personal sel...

This entry was posted on Sunday, June 22nd, 2008 at 8:46 am and is filed under Sales Training . You can follow any responses to this entry through the RSS 2.0 feed. Both comments and pings are currently closed.