How to Look Out for Number One – What Brokers Need to Know About Surety Bonds

September 17, 2009 at 11:09 pm · Filed under insurance selling ·Tagged

Prospective insurance brokers go through a crash course of learning and information consumption on their way to the profession. Regulations vary from state to state, but the steps toward successful completion of the licensing exam are typically marked by hard work, determination and long days.

But there’s one element of the new broker experience that often gets overlooked amid the studying, exam prep and celebration – bonding. Insurance brokers are required to obtain proper surety bonds filed with their state insurance department. Surety bonds often get confused with insurance and other forms of fiduciary guarantee, but they are a unique and all together common part of business and enterprise nationwide.

Despite that, hundreds of fledgling brokers wind up scratching their heads when the time comes to obtain an Insurance Broker Bond. Here’s an introductory primer on these specialized bonds:

What’s a surety bond?
Surety bonds are a form of credit, not insurance. Risk remains with the principal and never an insurer. Surety bonds provide financial protection for the obligee, or project/bond holder, which in this case would be the state insurance department.

How do Insurance Broker Bonds work?
A broker obtains a surety bond from a surety company or some other entity that issues bonds. The insurance broker bond gives consumers and the state financial protection in case the broker fails to follow regulations and laws related to the industry. Here are a few examples of illicit or unethical behavior that can lead to bond claims against an insurer:
=Falsifying quotes or figures to increase profit
=Telling clients to lie on applications
=Encouraging clients to lie or be dishonest about their financial health
=Encouraging clients to purchase products they don’t need
If a bond claim against a broker is deemed legitimate, surety companies have to pay damages or losses. But most bonds include an indemnity agreement that stipulates the broker ultimately reimburses the surety company for any claims paid.

How to Obtain Surety Bonds
Brokers can get surety insurance from surety companies and other professional sources that either specialize in bonding or offer bonds as part of their book of business. These are license and permit bonds. Each state’s insurance department, which acts as the obligee, requires paperwork and official documentation related to bonding.

Bonding Eligibility
Insurance Broker Bonds are relatively low-risk ventures. Surety companies will typically look at a prospective broker’s credit history, financial health and overall background before making a decision about bonding. Rates vary little from surety to surety for these bonds, but brokers with less than perfect credit will likely have to find a surety that specializes in issuing high-risk bonds. Rates for those riskier surety bonds will likely be higher.

To learn more about how to obtain a surety bond visit www.SuretyBonds.com, or email the author, kevin@suretybonds.com

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Seven Ways to Create Buyer Preference

September 8, 2009 at 11:10 pm · Filed under insurance marketing ·Tagged , ,

1. Share testimonials and success stories using print and video – Let someone else toot your horn.
2. Compile statistics and fact sheets – Allow the numbers to speak for themselves.
3. Facilitate competitive challenges so buyers can test drive your product/service and easily compare it to other options.
4. Create brand preference and loyalty through social marketing channels, such as blogs and Facebook postings.
5. Build personal trust through thoughtful relationships – Lack of trust kills countless deals; don’t let it kill yours.
6. Give something valuable away – Share a white paper, analysis or case study. If it’s relatable, it might close the sale.
7. Publish articles in industry magazines – It will boost your expertise and your credibility.

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The Four Ps of Copywriting

August 19, 2009 at 9:49 pm · Filed under Insurance Lead Generation ·Tagged ,

In business school, we all learned the four Ps of marketing: product, price, promotion and place. But, how about the four Ps of copywriting? Are they the same? Not at all. The American Writers and Artists Institue (AWAI) prescribes the following 4P formula for writing persuasively:

1. Paint a Picture – Use metaphors, analogies and stories to bring problems and solutions to life.
2. Make a Promise – Tell the reader what your product or service will do for him. Communicate your unique value proposition (UVP).
3. Offer Proof – Give your promise credibility by supporting it with facts, statistics, case studies and testimonials.
4. Push for Response – Create a highly desirable offer and make it irresistible.

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Is the Law of Supply and Demand Working for You?

August 5, 2009 at 9:44 pm · Filed under Uncategorized

When defining your target market, consider the long-standing principal of supply and demand. Do you want to go broad and target a large audience with stiff competition? Or, do you want to target a small audience with very little competition?

Small businesses and start-ups often use the shotgun approach, trying to target everyone. However, selecting narrower niche markets is often more lucrative, offering a rich source for ready-to-buy prospects.

If you’re interested in seeing supply and demand in action, check out Google’s free keyword tool at https://adwords.google.com/select/KeywordToolExternal.

By using this tool, you can easily gauge the online supply and demand for any potential product or service. Here’s how:

 Enter a keyword or phrase (your product or service) to see the search volume online each month. The search columns reflect the demand, showing the number of search queries in Google matching each keyword result.

 The competition column is a good indicator of supply, showing the number of advertisers bidding on each keyword relative to all keywords across Google. For example, the keyword “Marketing” generates very high search volume and very high advertiser competition. With the term “insurance sales marketing,” the demand is considerably less and so is the advertising competition.

By evaluating supply and demand before defining your audience, you’ll avoid expensive mistakes. Once you identify a high demand/low supply segment, you can easily craft a tailored, differentiated offering that attracts leads.

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PB&J Insurance Marketing at It’s Best

June 24, 2009 at 3:41 pm · Filed under Insurance Lead Generation ·Tagged , ,

This week’s topic is promotional sales letters, AKA the PB&J of marketing. Sales letters are great because they’re inexpensive and don’t require the extra expenses of design and printing. Below is the self-promotional letter that launched my business five years ago.

Insurance marketing letter - page 1Insurance marketing letter - page 2

Here are a few features that you’ll want to replicate in your own letters:

1. Ultra-specific headline that precisely targets the intended audience
2. Photo to add personalization and build trust
3. Offer prominently displayed on the first page
4. The copy focuses on selling the offer more than it focuses on selling my services. Remember, we just need the prospect to step into the sales cycle by making a small request.
5. Lengthy PS – just in case nothing else is read.

You’ll discover a few additional tips about promotional letter writing in this week’s issue of “Insurance Marketing News.” Not yet an Insurance Marketing News subscriber? Sign up today at www.insurancecopywriting.com.

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Want to be a Superstar?

May 19, 2009 at 5:49 pm · Filed under Insurance Lead Generation ·Tagged

Two insurance producers worked for the same agency. They were very much alike – they both were intelligent and personable, they both had a strong work ethic and they both were reputable in the community. Except, one producer seemed to struggle to write new business while the other was constantly successful, even nicknamed “Superstar” among her peers. The difference? Superstar understood WIFM.
The successful producer knows that it’s not enough to list the features of an insurance product or service—you’ve got to drive each feature “home” by showing the specific advantages your prospect will enjoy. The easiest way to transform a feature into a benefit is to ask, “What’s in it for me?” If you pose that question to each feature at least three times, the benefit will jump out at you!

As an example, let’s say our Superstar sells Medigap insurance. Her specialty is the Medicare Supplement Policy J, which includes At Home Recovery coverage. This coverage is a feature of the policy. The real benefit is that the insured won’t have to ask a family member for home care after a procedure, eliminating the imposition on a loved one AND the insured doesn’t have to hire a private nurse, saving big dollars! Hmmm… independence … avoiding impositions … saving big money … these benefits create the emotional desire that closes sales.

Is it time to audit your sales presentation? Are you spending too much time talking about features or about yourself? If so, you can wave your closing ratio goodbye. Prospects aren’t interested in who you are or what you’re selling, unless there is something in it for them.

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What do business insurance buyers want most?

May 19, 2009 at 5:46 pm · Filed under Uncategorized

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In marketing, which reigns supreme – beauty or functionality?

May 6, 2009 at 1:51 pm · Filed under Insurance Lead Generation ·Tagged , ,

In the quest to produce beautiful, yet effective advertising pieces, I find that it’s sometimes challenging to take a hard line. For example, here’s a common scenario: We’re creating an e-mail postcard … my designer gives three options … I need to recommend one option to my client …

Options #1 and #2 meet the direct mail standard – attractive headers and sidebars with black body copy on a white background, lots of links and reply buttons.

In Option #3, all the copy resides on top of the image – reversed out. The overall presentation is striking, but I know the readability is lacking. Also, there aren’t as many links and buttons since too many would muck-up the beautiful design.

What to do? It’s a dilemma because I like #3 and I know my client (who is less in tune with response factors) may also prefer #3. It’s edgier, more hip … but the real question is … WILL IT SELL? Will it convert readers into leads and leads into customers?

In an ideal world, with unlimited budgets, we’d try both. But if my client has a limited budget (and they all do), what’s the right choice? If I present a more functional option (more likely to sell) will I get beat out by an agency that shows my client a very beautiful but not very functional option?

This kind of dilemma comes up all the time in the marketing world. Do you want your home page to be dominated by Flash and design or by key words that will generate search rankings? Do you want to take a chance on humorous headline or should you play it safe by communicating the most important benefit?

Take a minute to think … as a client, how do you react to the choices presented to you? Do you carefully evaluate a marketing piece’s potential selling success based on objective criteria? Or, do you emotionally choose whatever looks best?

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Are your headlines hooks or sinkers?

April 21, 2009 at 3:36 pm · Filed under Insurance Lead Generation, Uncategorized ·Tagged

This week’s e-newletter explores the age-old question of what makes an effective headline. So, for this week’s blog, I thought it would be a fun to look at a few insurance headlines. So I reached into my magazine basket and pulled out an old issue of “Risk & Insurance.” Without naming names, let’s evaluate a few …

Headline #1:
THE STRENGTH AND PRODUCT DIVERSITY TO DELIVER INTELLIGENT SOLUTIONS

Grade: C This headline touts an “intelligent solution” feature – but it isn’t pushing any emotional buttons, stopping the reader in her tracks or compelling her to read further. What’s in it for the reader? The problem and the end-benefit are missing in action. I don’t believe most people are shopping for an “intelligent solution” – they’re looking for ways to save money or make money. Will this intelligent solution do the job? It’s hard to say.

Headline #2:
WE BELIEVE STRAIGHT TALK CAN LEAD TO STEADY BOTTOM LINES

Grade: B+ This headline makes interesting promise and it gets to the end benefit for the reader (steady bottom lines.) How much stronger would this headline be if it was written as a question without the word “we?” DO YOU BELIEVE THAT STEADY BOTTOM LINES START WITH STRAIGHT TALK?

Headline #3:
EVOLUTION IN THE FAST LANE -
IS YOUR PRESENT UNDERWRITER STUCK IN LOW GEAR?

Grade: A What you can’t see is that this headline is presented under an image of a turle with rocket on its back so there’s a strong curiosity factor. Beyond curiosity, this ad speaks to a specific relatable problem, in a question format. Nice!

What do you all think? Send me a few headlines and we’ll evaluate them together!

PS – If you aren’t yet subscribing to “Insurance Marketing News” sign up today at www.insurancecopywriting.com. It’s free!

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When it comes to sales letters, does size really matter?

March 24, 2009 at 6:39 pm · Filed under Insurance Lead Generation ·Tagged , ,

When it comes to sales letters, does size really matter? This topic has been endlessly debated. Many experts say that a sales letter needs to be as long as it takes to paint a picture, convey a promise, offer proof and push for the close. In some cases, it takes one page. In other cases, it takes 12.

Other pundits say that it depends on the audience and on the product/service you’re selling. For example, consumers who are purchasing “want to have” items such as health and fitness products have a much higher tolerance for lengthy letters than business owners who need insurance. That’s because health and fitness consumers are emotionally invested. They really want to lose weight or rid themselves of high blood pressure so they’re willing to read a lot. On the other hand, business owners are time starved, they don’t really want to buy insurance – they have to. And, they want to spend as little time as possible doing so. So, with business to business, “have to have” purchases, short letters may be more effective.

What’s your experience? How long was your most effective sales letter?

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