Preneed

Selling preneed. . . . positively

Foundation Partners why I partnered

Ask ten different consumers and you will get ten different opinions on “insurance”.  Especially, life insurance.  Some think it is necessary, some think it is a waste of time, some love the peace of mind it can bring, some will say let my survivors deal with the money after my death.

You get the idea. . . and when it means spending money on something that today’s “show me what it does for me today” consumers sometimes demand, the art of placing insurance can sometimes be a difficult task for someone like an insurance agent.

I am a licensed life and health agent in Minnesota. . . the license that you need to sell pre-need funeral insurance plans in our state.  And, for the last 15 years of my funeral home management experience I not only conducted monthly seminars but actively sold preneed for our funeral home in our community.

And, I learned the line cannot be, “You’re going to die someday, so buy insurance to pay for the funeral”.  The art of placing life insurance comes in placing that insurance knowing that it will help your funeral home (both now in commissions and in the future in market share and cash-flow) and letting the consumer client know how the purchase will benefit him/her even if they are deceased when it is collected.

I came across this article from Kiplinger’s entitled “Reasons to own life insurance in every decade of your life” and it reminded me of my “sales pitch” during the seminars that I conducted.  My pitch was always to illustrate to the 55 and over crowd that was attending how life insurance and financial planning had worked in the past for them and how that could be extended into the future.

Our funeral home has advertised funeral pre-planning and pre-financing for over 40 years.  Our tag-line on those ads have, and continue to say, “Like an umbrella in a sudden shower, having something before you need it is good planning.”

At our seminars, I would first start with going through funeral customs in our area and then getting into the costs involved with funerals, cremations, cemeteries and the like.  Once the numbers were added up I would always comment, wouldn’t it be nice to be prepared for that and not have to worry about it?

Then I would go into my situation.  I would tell them I am a planner and when I first started working I saved to buy a house.  When I was married and we started having children we began saving for college educations, I was saving in my 401k for retirement and on and on.  And, I would tell that the plan had worked thus far.  I had enough for a home payment, I had enough saved so my children did not have to borrow for college, and I was on my way to retirement.

At that point in the seminar I came to believe that the people sitting in the chairs were either reinforced with good financial planning because they too had done so as their lives had rolled out, their results were similar to mine, and preneed planning was just the next step forward.  Or, as I believe happened many times, married couples were sitting in our audience and realized that they had not planned and maybe thought they better start soon and this was a good time to make sure that they planned this funeral segment of their lives.

In both cases, I found that I had pretty interested groups and I always advocated that when they hit Social Security age, that was a great time to “take stock of their mortality” and plan for that day.  They could then have it out of the way and enjoy retirement.  And, another key was of these potential clients, many were Social Security aged or above. . . so the time was now.

Tom Anderson
Funeral Director Daily

There was no big, hard sell. . . . just the story of how I had planned and how that plan had been executed.  Seminar participants were left to fill out a short questionnaire with the final question asking if they wanted us to contact them about pre-arrangements.  Like clockwork, almost 85% of our attendees said “yes”.  As a matter of fact, we eventually had to limit our seminar attendance numbers so that we could be able to visit all affirmative answers within one month.

Related— I am a huge advocate of financial literacy for our population.  I believe a lot of the problems we have in America can be tied to consumers not knowing the ramifications – interest wise, payment length, principal amount – of their purchases or other decisions.

I’ve been an advocate, in my role as a college board member, of transparency in college loans and in advocating for required freshman courses in financial literacy.  It is interesting to note that at my very first college board meeting it was the annual meeting where the Student Council presented their ideas of what the college could do for them.

At that meeting, the student representatives stated something to this effect, “The university teaches us the tools to go out, find a job, and make a good living.  However, no one is teaching us how to wisely spend the money we are making.  We would appreciate more help with that.”

That really hit home to me.  I now also serve on the board of our local Junior Achievement chapter.  We go into the elementary schools and teach finances and free enterprise.  I think that is a needed skill for young people.

It hit home so much that I would suggest, if you have the ability as an employer, you would do employees, and yourself, a favor by offering to pay for financial literacy classes taught at a technical college, junior college, or other venue in your community.  It will help your employees cope with finances and in the long run, it will help you as your employees will know more about finances and how to keep in good financial health.

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One Comment

  1. Tom,

    Thank you for your article. I enjoyed reading it.

    Even though I have been on the preneed supplier side of funeral service for 33 years (Forethought, Homesteaders and, now, Great Western), I am only a recent subscriber to Funeral Director Daily. I have thoroughly enjoyed your publication and thank you for doing it.

    I wanted to share with you an article I wrote on preneed that I believe you will find interesting. It was first published in Poul LeMaster’s Parliament . I want to attach the edition so you can experience my article and Poul’s publication if you have not seen it. Please let me know the best way to do this. Thank you.

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