{"id":54953,"date":"2021-03-31T16:25:37","date_gmt":"2021-03-31T06:25:37","guid":{"rendered":"https:\/\/riskinfo.com.au\/news\/?p=54953"},"modified":"2024-10-30T08:44:50","modified_gmt":"2024-10-29T22:44:50","slug":"the-importance-of-pre-positioning","status":"publish","type":"post","link":"https:\/\/riskinfo.com.au\/news\/2021\/03\/31\/the-importance-of-pre-positioning\/","title":{"rendered":"The Importance of Pre-Positioning"},"content":{"rendered":"\n
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In the second of two articles in this series, industry consultant, author and former adviser, Chris Unwin, talks to advisers about the potential to create a paradigm shift in the way their clients view their ‘personal protection packages’ rather than their ‘insurances’…<\/h3>\n<\/div>\n<\/div>\n

<\/p>\n

In a previous article I talked about the concept of “setting out your stall”, which was all about creating a favourable first impression in that first five or ten minutes when meeting a potential new client for the first time.<\/p>\n

In this article, I\u2019m going to explore how we can create a paradigm shift in the way our clients view their \u201cpersonal protection package\u201d \u2013 which up until now you may have been calling their \u201cinsurances\u201d! This is just one example of how important it is that we are consciously avoiding the use of terminology that creates a negative perception in the minds of our clients, thereby giving us the opportunity to turn what has historically been a \u201cgrudge purchase\u201d or at best an \u201cexpensive necessity\u201d into a \u201cfantastic opportunity\u201d for our clients.<\/p>\n

There are three things we need to be pre-positioning with our potential new client early in the engagement process:<\/p>\n

    \n
  1. The role that protection plays in a wealth creator\u2019s financial plan<\/li>\n
  2. The \u201cwants analysis\u201d as opposed to the \u201cneeds analysis\u201d<\/li>\n
  3. The \u201cpercentage concept\u201d<\/li>\n<\/ol>\n

    So let\u2019s first have a look at how we position protection within the context of our client\u2019s financial plan:<\/p>\n

    The role that protection plays in a wealth creator\u2019s financial plan<\/strong><\/p>\n

    The first thing we have to understand is WHY protection MUST be the first cab off the rank in a wealth creator\u2019s financial plan. To this end, I would recommend using a \u2018terminology tool\u2019 on yourself, which you can then in turn use on your wealth creator clients.<\/p>\n

    Would you agree that ANY investment strategy designed to accumulate wealth for your client in the future involves, by definition, making plans with your client\u2019s income on an ongoing basis? Clearly the answer to this question is yes.<\/p>\n

    Therefore, as a professional financial planner, how can you justify making plans with your client\u2019s income on an ongoing basis BEFORE (or even worse WITHOUT) doing everything you can to protect and secure that income as best you can on an ongoing basis and, importantly, how do you think that practice might be viewed in a court of law? Wouldn\u2019t you say it virtually amounts to the very definition of \u201cprofessional malpractice\u201d?<\/p>\n

    So the first step I suggest you take in positioning protection within the context of a financial plan for your wealth creator clients is to use this \u2018terminology tool\u2019 when outlining the range of services you can offer as per your FSG.<\/p>\n

    The \u201cwants analysis\u201d as opposed to the \u201cneeds analysis\u201d<\/strong><\/p>\n

    Now let\u2019s check out the relative benefits of a \u201cwants analysis\u201d versus a \u201cneeds analysis\u201d and how to pre-position it.<\/p>\n

    For a long time in my advice practice I, like most advisers, did a needs analysis on my clients for their personal protection requirements. More often than not this process relied upon the \u2018fear factor\u2019 and painted the \u2018what if\u2019 scenarios which typically involved the \u2018back up the hearse and smell the roses\u2019 methodology, thereby turning the personal protection package into a grudge purchase made with very much a \u2018just in case\u2019 attitude on the part of the client.<\/p>\n

    …nobody derives any real enjoyment from talking and thinking about what they NEED<\/p><\/blockquote>\n

    Then one day I had a \u2018light bulb moment\u2019 and realised that nobody derives any real enjoyment from talking and thinking about what they NEED, but conversely they get a lot of enjoyment out of talking about what they WANT, and from that moment on, I never did a needs analysis on a single one of my personal protection clients \u2013 I did a wants analysis instead and this revolutionised my business.<\/p>\n

    We need to recognise that it is our clients who are the experts when it comes to knowing what they WANT \u2013 not in terms of levels and types of cover (that is OUR area of expertise), but when it comes to FINANCIAL OUTCOMES in certain specific \u2018what if\u2019 situations, and it is our job to help our clients verbalise what financial outcomes they would WANT in those specified \u2018what if\u2019 situations, and this is what the questions we ask on the Fact Find at the discovery phase should be designed to do.<\/p>\n

    Once you have bought into the concept of the \u2018wants analysis\u2019, it is essential that the pre-positioning of the \u2018wants analysis\u2019 forms part of your \u201csetting out your stall\u201d (see previous article). In order to enable your potential client to relax, it is essential that you establish and get agreement on the purpose of the meeting you are about to have. In my case, this led seamlessly into a simple outline of the rest of my initial advice process and the basis for my recommendations. This pre-positioning of the \u2018wants analysis\u2019 went like this:<\/p>\n

    \u201cMy mission today is NOT to get you to tell me what it is that you would need to survive financially in certain \u2018what if\u2019 situations \u2013 I\u2019m really not interested in that. What I AM on a mission to do is to help you tell me what it is that you would WANT in terms of FINANCIAL OUTCOMES in those same \u2018what if\u2019 situations, because once I know what financial outcomes you would want, I will be in a position to use my expertise to put together my recommendations for appropriate types and levels of cover that are specifically designed to achieve those financial outcomes you have told me you want and hopefully within an affordable budget. Does that all sound reasonable?\u201d<\/p>\n

    The \u201cpercentage concept\u201d<\/strong><\/p>\n

    Lastly, what would you consider to be the biggest obstacle you have to overcome in getting your clients to buy appropriate types and levels of cover? I would suggest it is always going to be the cost \u2013 after all, if your clients could have appropriate types and levels of cover for nothing, then how much resistance would you encounter?! So anything we can do to lower the bar when overcoming the price barrier is hugely beneficial for all parties. So let me share with you something I call the \u201cpercentage concept\u201d and how I pre-positioned it with my clients.<\/p>\n

    I found the best time to introduce the percentage concept was when I got to the superannuation section of the Fact Find. When arriving at this point, I suggest you ask your client the following three questions:<\/p>\n

    Question 1:<\/u><\/p>\n

    \u201cWhat percentage of your income is currently being allocated to securing your income for AFTER your working life?\u201d For most employed people, the answer to this question right now is 9.5%<\/p>\n

    Question 2:<\/u><\/p>\n

    \u201cWhat percentage of your income is currently being allocated to securing your income for DURING your working life?\u201d This is an accurate description of what your client\u2019s Personal Protection Package is designed to do, that is to secure your income for yourself in the case of illness or accident and for your family in the event of your death. The answer to this question for most people is 0% and for others it is nowhere near 9.5%<\/p>\n

    Question 3:<\/u><\/p>\n

    \u201cTell me, which of these income streams \u2013 AFTER your working life or DURING your working life \u2013 is more important to you right now?\u201d<\/p>\n

    What I would do at this point is to say: \u201cYou may be interested to know that over the last 12 months my new protection clients have typically deemed it appropriate to allocate somewhere between 4% and 5% towards securing their income for during their working life. Do you think that might be an appropriate allocation of funds on your part?\u201d What a powerful question, as it means that most people are allocating around half the amount of money towards the MORE important income stream as they are towards the LESS important income stream \u2013 sounds pretty reasonable to me!<\/p>\n

    From this moment on, whenever the ugly spectre of cost rears its head, you can revert to the percentage concept rather than the dollar figure and given the importance of the perception we are creating in the mind of our clients, rest assured that the percentage figure will ALWAYS be perceived as less than the dollar figure.<\/p>\n

    \n

    \"\"<\/a><\/p>\n

    If some of the content of these two articles has resonated with you and you feel you would like access to a wider range of simple, practical and usable client engagement tools, then check out some additional upskilling opportunities from Chris Unwin such as:<\/p>\n

    1) 4 Online Workshops, two of which are risk advice specific and the other two are focused on more generic soft skills. Each one offers 6 or 7 hours\u2019 worth of content segmented into bite size sessions and you have unlimited access to the content for a period of three months, so you can self-educate in your own time and at your own pace:<\/p>\n

    https:\/\/www.chrisunwin.com.au\/shop\/search\/6571\/online-workshops.html<\/a><\/p>\n

    2) One on One Coaching (face to face or online) \u2013 this enables you to get personalised coaching on targeted content specific to your particular needs:<\/p>\n

    https:\/\/www.chrisunwin.com.au\/pages\/one_on_one_coaching.html<\/a><\/p>\n

    3) \u201cThe Risk Workshop\u201d \u2013 Chris\u2019s book \u201cThe Risk Workshop\u201d lays out a detailed 12 Step Process for your client engagement in the risk advice space.<\/p>\n

    \u201cThe Risk Workshop is spot on in terms of delivering much needed value for advisers, to help them both elevate the quality of their life insurance conversations with clients, and to successfully build the value of their practices.\u201d Peter Sobels, Director, Riskinfo<\/p>\n

    https:\/\/www.chrisunwin.com.au\/shop\/product\/12565\/the-risk-workshop.html<\/a><\/p>\n

    W: www.chrisunwin.com.au<\/a><\/p>\n

    E: chris@chrisunwin.com.au<\/a><\/p>\n<\/div>\n

    Back to Adviser Focus Main Page…\u00a0<\/a><\/p>\n\n","protected":false},"excerpt":{"rendered":"

    In the second of two articles in this series, industry consultant, author and former adviser, Chris Unwin, talks to advisers about the potential to create a paradigm shift in the way their clients view their ‘personal protection packages’ rather than their ‘insurances’…<\/p>\n","protected":false},"author":3,"featured_media":54957,"comment_status":"open","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[6868,6837],"tags":[],"class_list":{"0":"post-54953","1":"post","2":"type-post","3":"status-publish","4":"format-standard","5":"has-post-thumbnail","7":"category-adviserfocus","8":"category-soft-skills"},"_links":{"self":[{"href":"https:\/\/riskinfo.com.au\/news\/wp-json\/wp\/v2\/posts\/54953","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/riskinfo.com.au\/news\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/riskinfo.com.au\/news\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/riskinfo.com.au\/news\/wp-json\/wp\/v2\/users\/3"}],"replies":[{"embeddable":true,"href":"https:\/\/riskinfo.com.au\/news\/wp-json\/wp\/v2\/comments?post=54953"}],"version-history":[{"count":0,"href":"https:\/\/riskinfo.com.au\/news\/wp-json\/wp\/v2\/posts\/54953\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/riskinfo.com.au\/news\/wp-json\/wp\/v2\/media\/54957"}],"wp:attachment":[{"href":"https:\/\/riskinfo.com.au\/news\/wp-json\/wp\/v2\/media?parent=54953"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/riskinfo.com.au\/news\/wp-json\/wp\/v2\/categories?post=54953"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/riskinfo.com.au\/news\/wp-json\/wp\/v2\/tags?post=54953"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}