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Practice Management In a Post-Election World

Industry Commentary by Harry N. Stout

Stout-Feature-Dec2016

I am writing this article several days after the final presidential election results and upon returning from an industry meeting where I met with financial professionals from around the country. Based on my travels, conversations with producers and my own research, I have seen that there is much uncertainty regarding the policies the new White House administration will be pursuing. From the standpoint of our industry, I see this uncertainty as an opportunity for financial professionals to better serve their clients and prospects, but to do so they must prepare their practices for what will likely be a period of substantial change in the financial environment.

In recent days, many political pundits and the financial media have written extensive pieces on the policy, demographic and socioeconomic reasons for why people voted as they did. To me, the key reason for the surprising election result is one our industry is uniquely qualified to address – economic uncertainty. Americans are worried about their incomes, their jobs, paying for the education of their children, protecting their families against loss and meeting their day-to-day financial obligations. As I learned early in my career, we offer products that help lessen financial uncertainty. As a wise older gentleman told me early in my career – we offer products that provide money for future delivery. That future need may be retirement, a health crisis, the death of a key breadwinner or the impact of an accident or illness.

Practice Management is: “The business practices, services, infrastructure and product solutions that enable financial professionals to acquire, assist and create solutions for their customers.”

Are you and your practice prepared to help your clients and prospects with their post-election induced financial uncertainty? Do you have a structure and programs in place to accomplish this? This article will walk through the key considerations you need to have in place to make your practice more effective and give you two very simple but effective post-election sales ideas to take to market.

The Imperative to More Effectively Manage Your Practice

If you ask financial professionals for the meaning of practice management, you’ll likely get wildly different definitions. For purposes of this article, I would ask you to look at practice management as

“The business practices, services, infrastructure and product solutions that enable financial professionals to acquire, assist and create solutions for their customers.”

I always look to a successful business as being built to meet customer needs. If you use the above definition to look at every aspect of your practice, you’ll be able to find solutions to any challenge presented by the markets and adapt to clients’ goals in this post-election world.

Is Your Practice and Related Service Effective for Your Clients?

The key focus of practice management is to meet clients’ needs as effectively as possible. Are your operations set up to move quickly? Are your operations set up to get your clients the information they need to identify their key financial challenges? Are you flexible and timely in responding to client requests? The abilities to inform and be responsive on a timely basis differentiate your business. But to be able to do these, you need the right practice management tools. In this article, I will highlight the practices and infrastructure elements that I believe are most important in today’s world.

The Knowledge Foundation

The foundation underpinning your practice is the knowledge and experience of you and your team. What are you doing to make sure those competencies are kept up-to-date and fresh? In the next year, we will likely experience tax reform, healthcare changes, regulatory change and a rapidly evolving economic environment. Are you ready for these actions? Will you be able to translate the impacts of these events for your clients? Have you planned the training and professional developments for your business, assuring that you are able to advise your clients on how they should approach the post-election world. As you plan for 2017, it is more important than ever to improve you and your team’s professional development and general business knowledge. It needs to be a key part of each member of your team’s responsibilities – this knowledge foundation will be key to your success in the New Year.

Your Technology Footprint – The Data-Driven Practice

How do you communicate with your existing clients and prospects? How do you notify them of key issues that they may want to speak with you about? How do you track your client conversations and records?

If you have an established practice or are just starting out, you need to have a robust database of your clients and should build regular, repeated communication capabilities into your business. Luckily, today, you have a vast number of customer relationship management software solutions (CRM) at your disposal. If your practice is able to get effective, timely messages out to your clients, the service is invaluable to them and will result in more business for you. If you have not made the necessary investment to purchase or upgrade your CRM technology, the time is now.

One easy way to pay for these technology upgrades is to use data-mining capabilities to generate prospects. One such simple idea is to look through your customer base for clients reaching age 70 and to reach out to them to see if you can assist in educating them on the issue of required minimum distributions from qualified plans and to see if they have any additional financial needs such as final expense coverage. This is a simple idea but you need the data at your fingertips to implement the program.

Another important element that your CRM should provide is helping you with your client-related record keeping which is especially important in today’s regulatory climate. It is important to keep detailed records of your client conversations, information they provide to you that backs why certain products meet their needs and all of the documents such as fact-finders completed by the client. Having a system to track this is invaluable if questions arise at a later date.

Client Education as a Competitive Advantage

During uncertain times, making your practice the source of reliable, consistently provided, and credible information on the changing financial landscape is a great way to position your practice. Today, clients want to be financially educated more than ever and our industry is well positioned to deliver this education. It is a great practice service for you to hold regularly scheduled educational seminars at your local library or neighborhood restaurant where you provide information on the changing financial environment as a service and not as a pretext for generating sales.

Client service events such as this, position your practice as the place to go with questions regarding financial needs. A better-educated customer only makes your practice more valuable in the eyes of your customers.

Two Simple Sales Ideas

As the New Year unfolds, here are two simple ways to have your practice reach out to existing customers with a timely service – The post-election life insurance checkup and the retirement income checkup.

The Life Insurance Post–Election Checkup
Just as your clients have routine health, dental, and even checkups for their animals, life insurance could use a periodic checkup too. By taking time to review their current life insurance policies, personal circumstances, and changing needs, your clients may be able to:

  • Make sure their families have the proper protections and accumulation products in place
  • Ensure that their life insurance is in sync with changing tax laws
  • Add to or reduce the amount of life insurance they have
  • Validate that their policy is performing up to expectations
  • Verify their beneficiary designations are up-to-date
  • Earmark policy proceeds for their favorite charities

Before you meet to conduct the checkup, it will be helpful if you requested your client to tell you a bit more about themselves and their family, the changes they’ve encountered over recent years, and what they hope to accomplish during your checkup.

The Retirement Income Post-Election Checkup
The retirement income checkup is similar to the life insurance checkup. Post-election is your client’s retirement income plan still valid and on track to generate the income needed in retirement? Significant matters to be looked at during the review include:

  • Have living expenses projected during the retirement years changed
  • Have any health events occurred requiring the need to fund additional medical costs?
  • Changing federal and state income tax rates
  • The costs of healthcare in retirement based on legislative changes made or contemplated
  • Interest and equity market rate of return assumptions, if there are pronounced changes in government monetary and fiscal policies.

During the course of the checkup, financial needs may be identified that did not exist previously, giving rise to opportunities to serve the client better and generate sales.

Last Thoughts

The next year will be one of continuing change and opportunity for our industry. Can you position your practice to better serve clients and prospects? If you focus on a few selected practice management actions, you can provide the education, information and services needed to help alleviate the financial uncertainty of your customers. You will also find great personal satisfaction in using your expertise to help people when they need it most.

How do you get started? Sit down and write out your plan. Identify the areas where you can enhance your practice, areas where you need to invest in your practice and identify your key client profiles.

In addition, be sure to think ahead for yourself. Do you have your retirement plans squarely in place? If you are in your 40s, 50s or 60s, do you have a succession plan in place to help you transition into retirement and ensure your clients are still well served?

Right now is the perfect time of year to prepare, plan and renew your practice through an added focus on practice management.


Harry Stout

Harry N. Stout is Managing Director of Insurance Insight Group LLC, a national marketing and strategic consulting firm serving the life and annuity industry. He is also a leader at LifeAnswers Financial Group, LLC. Prior to his work with IIG and LifeAnswers, Harry was managing director of investments and insurance with Australian and New Zealand Bank. He spent many years as president of ING’s U.S. retail annuity business, along with more than a decade as chief executive officer and president of Fidelity & Guaranty Life Insurance Company.

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