1. How Did You Get Into The Insurance Business?This is an indirect way of asking why they decided to sell insurance. Who grows up aspiring to get into commissioned sales? Are they part of a family business? Couldn’t they find another job?
One advisor may look much like another. When you start with why (see Simon Sinek’s TED Talk), you often find big differences.
2. What Products Are You Licensed To Sell?Many advisors are reluctant to "leave money on the table". They may sell a range of products like life insurance, health insurance, employee benefits, mutual funds, segregated funds, annuities and mortgages. You'll often see what they provide on their business cards and websites.
Did you buy your last TV at a department store?
One-stop shopping may look appealing but can an advisor really master everything? You could hire specialists instead. A plumber, electrician and painter each have much more practical experience than a handyman.
3. Which Companies Do You Have Contracts With?A captive advisor is like a commissioned employee and only allowed to sell what that company permits — which may be less competitive and less flexible. The advisor’s business card often has the name of the company, rather than their own brand.
An independent advisor can have a contract with most insurance companies. To get business, the insurers must be competitive. Since products and procedures differ, an advisor cannot realistically know them all well. Advisors often do most of their business with several insurers.
Variants: which companies’ products do you not sell? Why?
4. What Designations Do You Have (And What Do They Mean)?The world of life insurance is especially complicated because you're dealing with risk, accounting, investing and law. Assessing your needs and developing optimal solutions takes skill. Yet selling insurance requires little more than passing a multiple choice exam.
The better advisors take the time to earn designations that require some effort. Look for a CFP (Certified Financial Planner), or — better still --- a CLU (Chartered Life Underwriter). These designations impose additional standards of conduct on their members. For instance, there are requirements for continuing education.
Ask advisors what their designations mean, how much continuing education is required and why they matter.
5. What Associations Do You Belong To?There's no self-regulating association to which insurance advisors must belong. There are for accountants, actuaries, doctors, engineers and lawyers. The associations can investigate and discipline members for misconduct. The processes may not be perfect, but they're well intentioned.
Insurance advisors aren't required to belong to any association. In Canada, the main association for advisors is called Advocis. It’s reasonable to expect advisors to belong, though some prefer the Independent Financial Brokers (IFB). Advocis has an sister organization for top advisors called Conference for Advanced Life Underwriting (CALU). There’s also the Million Dollar Roundtable (MDRT).
Associations promote the interests of their members. Yet some advisors won't join. They get the benefits from the lobbying the associations do without spending a penny. What moochers! If they'll take shortcuts like this, be wary.
6. Where Is Your Blog?Advisors often acknowledge they should have a blog but they don’t have time, they don’t know how, they aren’t convinced of the ROI, …
Advisors can create and publish their original content through a blog (or podcast or video). LinkedIn is an excellent, easy-to-use platform. How often do they publish? How much do they publish? When did they last publish?
There are many advisors but only one you. Why not take the time to find the right advisor for you?