Getting someone to buy insurance can be challenging.
Insurance helps people plan for the unexpected, but most people are hard-wired to believe that conditions today will persevere forever. The fact that an unforeseen injury can lead to loss of income, that a parent might need long-term care, or that a natural disaster might strike are not scenarios we naturally entertain. People might also put off buying insurance because they think it is too expensive, feel intimidated by the process, procrastinate or balk at the thought of monthly payments for coverage on something that seems so unlikely to happen. These psychological biases are well-studied and cataloged by behavioral economists.
Humans, survivors of dangerous times where risks included being eaten by dinosaurs, are still in possession of ancient brain processes which today inhibit us from purchasing insurance.
Our Two Minds
Human reason is roughly divided into two categories, one for fast-thinking and the other for more conscious, complex deliberation. System One covers routine tasks like catching a ball or riding a bicycle. The irrational Homer Simpson is the purest example of how this System One lizard brain functions: constantly reacting to stimuli with little regard for long-term consequences.
System Two covers decision-making processes that require more effort like trying to solve a complex math problem. An example of System Two thinking is the rational Vulcan Mr. Spock, who would often call out his “highly illogical” colleagues.
Unfortunately, potential insureds and sales producers are more like the appetite-driven Homer Simpson. They prefer to engage with System One. It is easier and more comfortable. They live in the realm of instinct and reflexive practiced response, they feel in their guts that they’re making the right decisions. However, System One can lead them to make irrational, impulsive and short-sighted decisions.
Convincing Homer Simpson
If you want to sell insurance to someone who is more comfortable operating from System One, stop treating them like Mister Spock. So much of our sales literature, product descriptions and terminology address a rational audience. Insurers must start addressing System One processes if they want to reach more customers.
To accomplish this, the insurance professional leading the discussions must be equipped to deal with their own and with their client’s tendencies and biases. Intermediaries must know when to speak in emotional terms with stories and messaging that appeals to the System One brain. The seasoned professional typically learns this through direct experience or from their colleagues. They learn to notice and address cues that a potential insured is putting up barriers to actions that will benefit them over time. The seasoned sales agent knows when to nudge prospects towards a sale.
Learning through experience is slow, imperfect, and wasteful. Unless a meeting occurs in a group setting, post-mortems about what went wrong will be limited to a salesperson’s notes and recollections. Companies try to jumpstart their sales professionals through training programs. But information learned this way is often quickly forgotten. If only we could borrow freely from the hours of experience earned by our most successful colleagues.
Fortunately, technology offers a solution.
Real-time Sales Coaching
A visually compelling, digitally-enabled, and interactive presentation platform can help guide a sales professional through a personalized set of sales motions to remove barriers and encourage decision-making. This interface connects intermediaries to their organization’s collective knowledge on how to address psychological biases in insurance sales.
The interface, accessed through a laptop or mobile device offers suggestions for moving the conversation forward as concerns and objections arise.
More than 150 behavioral tendencies might arise in any meeting. These can be identified and addressed in real-time. For example, planning fallacy is our tendency to underestimate how long it takes to execute tasks, and may cause a client to cut a meeting short from the belief that big decisions can be made later. Here, the technology platform may nudge the salesperson to discuss why a specific insurance policy is better put in place now than later. This can give sales professionals a digital cheat sheet to help lead them to success.
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