If good customer service cost less than bad customer service, which would you choose. Trick question, right? Let me qualify that question a little. If you knew ahead of time that you were making a major purchase that offered little or no customer service after the fact, and you could get the same product for less with customer service exactly the way you wanted it, which would you choose?
1. Let me say first that customer service in the life insurance business has really earned a bad reputation. As an industry we didn’t just get the reputation, it was worked at and earned. An annual review is nothing more, for most agents, than an opportunity to try to sell you something more or bug you for referrals. It sure doesn’t mean you need to buy anything, but after a while it can become annoying.
2. Life insurance customer service starts with the agent making the best possible recommendation for the customer. It’s very easy for agents to fall into the trap of always recommending the company or the product that best fits into their own bank account. I know agents and agencies that will just not tell you their is a better price or product because the compensation percentage is lower on that product
3. A good example was a call I got today from a woman that needed another opinion. She was sold a variable universal life policy some years back and it is headed down the toilet. Her agent has stayed in touch every year suggesting to tweak it this way or that and it has continued the death spiral. This year the agent suggested rolling over (new sale) the failing VUL into an indexed universal life. When he sold her the VUL he had made much of the idea that a 7-8% ROI was pretty common with the product. What he didn’t tell her is that it would be a negative 7-8%. Now he wants to roll it over into a product that will put a stop to her losses (that’s the guarantee), but an 11% ROI is pretty common (that’s the assumption). This agent is making monster bucks from his client by taking her from one bad product to another and taking advantage of the fact that she perceives him to be an expert. I mean who would have ever thought the economy would do that?
4. On the other hand, customer service exactly the way you want it sounds kind of interesting. It starts before you ever buy. Customer service can first be sighted when you are working with an agent that doesn’t push to close the sale. We’re all taught or at least exposed to closing techniques during our career. You turn to the wife and say, “Have you ever known anyone that lost their husband unexpectedly? Death isn’t one of those things on a calendar you can plan for, right? If your husband didn’t wake up tomorrow morning or didn’t make it home from work tomorrow evening, would you and your five beautiful children get by OK, or would it be a nightmare train wreck?” My wife and I went to a timeshare sale presentation a few weeks ago. Those people are experts at tag team closing and getting you to sign a contract believing that it really doesn’t bind you to anything. I hate an attempt to close a sale on me, timeshare, cars or insurance, and I think anyone that works that way has just shown you the tip of the iceberg.
5. So, let’s say you find a life insurance agent that doesn’t push to close and you make your decision to get a policy through them. The next step in good customer service is total honesty. If the agent doesn’t voluntarily tell you what’s guaranteed and what isn’t guaranteed in the policy and answer all of your questions to the fullest, they’re either lazy or trying to hide something. Lazy life insurance agents don’t last so they won’t be around for continued customer service and they’re trying to hide something, well, customer service starts with a true desire to have an open and honest relationship with the customer.
6. So, having jumped a few customer service hurdles and you’ve applied for life insurance, the next chance for an agent to fail is by not keeping you informed about what is coming and what the status of your application is. Forgetting to tell a customer, for instance, that they will be getting a personal history interview phone call can really be upsetting. Getting an unplanned for call to ask personal history and financial information questions actually can seem borderline scam. Not telling a customer what to expect or how to prepare for an exam can be a bit of a rude awakening also. Not calling a customer once a week to tell them what stage their application is at, is well, just rude. It can sometimes take a month or longer to get a life insurance application approved, especially if medical records are involved, and I know agents who take an application and don’t call the client back until it is approved or declined.
7. Next is when the policy is approved. An insurance policy to me is about as simple a contract as you’ve ever seen, but I work in the business and have seen thousands of them. If your agent doesn’t encourage you to read through it and ask questions before he walked out with your premium check (his commission check). What the heck? Not showing you in the policy important features that you ought to know about, like an accelerated benefit rider or a conversion option, is like slipping you a cake with invisible frosting on it (that was definitely a bad analogy). But you know what I mean. An agent is about to make money from their work for you. They can at least tell you how the thing works.
Bottom line. If you have an agent whose customer service through the application process shines, you will also have an agent that will take care of you over the years without trying to sell you something every time you talk. If you have any questions or have endured or are enduring bad life insurance customer service, call or email me directly. Let’s talk.