What’s best, Final Expense or Mortgage Protection?

Do you like daytime activity or are you totally cool with taking mostly evening appointments? Would you like to sell life insurance to financially responsible people who are difficult to sell/close, or would you rather target market to fixed income seniors who are barely getting by but are much easier to close? These are 2 of the questions that you’ll need to ask yourself before choosing a market to work. The final expense and mortgage protection sales industries can both be very lucrative, if you’re with the right insurance marketing organization. The trick is to find an IMO that fits your goals and needs and is easy to work with. Of course there is a lot more to it than that. Here’s what we’re going to go over.

Mortgage Protection Leads vs Final Expense Leads

Aged Leads vs New Leads

Appointment Setting – FE vs MP

Door Knocking – Final Expense vs Mortgage Protection Sales

UL vs Term vs Whole Life

Underwriting – Final Expense vs Mortgage Protection Sales

Presentation Differences

The Prospects – Final Expense vs Mortgage Protection Sales

Training – Final Expense vs Mortgage Protection Sales

Persistency and Placement MP vs FE

MP Commission Levels vs FE Commission Levels

MLM Business Model – Mortgage Insurance Sales

Independent Agent Business Model

Captive vs Independent

Recruiting

Mortgage Protection Leads vs Final Expense Leads

When it comes to leads, it’s important to have access to the right lead for your targeted audience. With mortgage protection leads your options are limited and can be very expensive. Direct mail leads are the only real lead option for marketing people with new mortgages. These types of leads cost around $52 to generate. Most of the mortgage protection sales IMO’s will charge around $39 for this lead and will resell it to another agent if it’s not sold within a specified amount of time. This is really the only way that they can make their money back on the lead. In most cases, we have noticed that these IMO’s will keep selling the lead over and over, until an agent makes a sale from that lead. The mortgage protection agents will also, usually take a haircut on their commissions for access to these leads too.

When it comes to final expense sales, lead generation is totally different than mortgage protection sales. With final expense sales you have direct mail leads, Facebook leads, and Telemarketer leads. Unfortunately, a lot of IMO’s resell leads but there are plenty of companies like ours, that never ever resell them. I believe that an agent is better off getting full commission levels and never having to worry about another agent getting to work his old lead. Sometimes a lead will be worked for several months before it turns into a sale. The final expense direct mail leads cost around $30-$35 each while Facebook leads sell for around $20 each. Final expense telemarketed leads cost around $10 to $20 each. We generate a high quality final expense telemarketed lead for $9-$10 each. Facebook leads are about the same quality as direct mail leads. TM’s are cheaper for a reason.

What About Aged Direct Mail Leads?

When it comes to mortgage protection sales, half of the policies sold are from an aged or re-worked lead. When newer agents get their hands on a brand spanking new direct mail lead card, they usually aren’t as good at handling objections as a seasoned agent. After one objection, a newer agent will put a new lead to the side and move on. These new leads can go without a presentation being made for months, or even longer. The longer you work the mortgage protection sales market, the better you will get on the phone at setting appointments and the better you will get at closing sales. As with any industry, there is a learning curve involved. For this reason, buying second chance leads is often the best way to go. At least for mortgage protection sales! The leads cost less, and in many cases, haven’t been worked correctly.

With final expense sales, working aged leads can often work better than with mortgage protection sales. One of the pros and cons of final expense vs mortgage protection is that mortgage protection sales have a better placement and persistency ratio. Here’s what I’m getting at. You can sell a final expense prospect. They might make a few payments and then cancel as it’s harder for them to afford the insurance. The next thing you know, you are in front of this same prospect a year later and are making another sale from them. I sold a lady last year from a door knock. She wouldn’t take the appointment by phone, and I went months without door knocking her. Finally got around to stopping by! She had an overpriced insurance policy for a couple years now. This turned into a solid replacement/sale that won’t ever be replaced.

Appointment Setting Differences

With mortgage protection sales, it is more difficult to set appointments compared to final expense. I must say one important thing about selling mortgage insurance. The experience that I received from setting mortgage protection leads was invaluable to my career for final expense sales. Having sold mortgage protection for years, I was easily able to switch over to final expense appointment setting. You see, with mortgage protection, you are getting a lot more information and asking medical questions while setting the appointment. Also, the people are more responsible and younger, therefore more likely to give you objections over the phone. Think about it. With mortgage protection sales, you’re seeing younger professional who are responsible enough to have a mortgage. With final expense, most people we meet do not have the capacity to manage a mortgage payment or already have their mortgage paid off. That’s just one reason!

When it comes to final expense appointment setting, the lead card is completely different than with mortgage protection sales, and the call is much shorter. We are simply going to stop in real quick to show the prospect what they will qualify for. All the underwriting with FE is done face to face, so you must be good at field underwriting. This makes it easier to set the appointment. The typical phone conversation for a final expense appointment is usually just 2-3 minutes. With mortgage protection sales, the call can go on for 5-7 minutes or even longer. Add in the fact that these seniors are often getting a lot of stuff in the mail and tend to look for freebies or handouts. This is one of the reasons that we don’t mention life insurance during the appointment setting process for final expense sales.

Is door knocking leads viable with mortgage protection sales?

As far as I’m concerned, door knocking mortgage protection leads is not nearly as viable as door knocking for final expense. You see, in many cases these MP leads are of people in gated communities or of professionals. The younger professionals are not going to let an insurance agent into their home without a set appointment. At least this was my experience. When I attempted to door knock back in my mortgage protection sales days, it seemed like I got nowhere. I can honestly say that I don’t believe I was able to make one presentation off days of door knocking. Now back then I wasn’t as strong at the door as I am today, but it is definitely a lot harder to get any leeway with DK’ing MP leads vs Final Expense leads. For door knocking, I want an easier market to work than final expense.

This is one of the reasons that making the move from mortgage protection sales was so easy for us. Mariana and myself were able to easily door knock our final expense leads and get results almost immediately. As a matter of fact, one of the first things we were taught was that all FE leads should be door knocked. This was the night and day opposite than with mortgage protection sales. While selling mortgage insurance, it’s absolutely a must to have the appointment setting skillset. We have several final expense agents that will only door knock leads. There are several agents that do cold door knocking sever hours a day, too. With the right mindset, you can actually be successful from cold door knocking our final expense prospects. This is not how it works with mortgage protection sales. Cold door knocking does not work for agents doing mortgage protection sales.

UL, Term, and Whole Life – What’s what?

Ok, so instead of breaking down Universal life, Term Life, and Whole life insurance, let’s make it easy. For mortgage protection sales you will write half of your business with either Universal Life or Term Life. The other half will be seniors that will be better options for Final Expense Whole life insurance. What’s the difference? UL and Term are either Simplified Issue or Fully Underwritten. With simplified written policies, the underwriter does a phone interview and checks the MIB and does a script check. If they want more information, they might pull doctor records. At this point, they might even request to have a paramedic stop by the client’s home to draw blood and ask a boat load of questions. Term and UL also tend to have an expiration date. In most cases, the client can actually outlive his life insurance. With whole life it’s different.

The other half of the leads you see while making mortgage protection sales, will be written with Whole life or Final expense insurance. These are the older folks you meet with that have health conditions. In most cases, the only way to go for seniors is whole life insurance. You can get fully underwritten whole life for your prospects. They will need to be very healthy. In most cases, the usual Simplified Final Expense product will be sold during Final Expense sales. With final expense/whole life insurance, the price will never go up and the policies build cash value. That makes this product ideal for people that have a need to for insurance designed to cover their funeral. Since final expense has easier underwriting than Term and UL, it is a better and easier option for the older people that you might end up doing mortgage protection sales with.

The Presentations – Final Expense vs Mortgage Protection

If you do it correctly, the Mortgage Protection Sales Presentation is a lot more complex than the typical final expense presentation. Back when I was a Hartford agent, we put a lot of emphasis on the “sizzle” and on Showmanship. My presentations took several pages of drawings with written explanations of how interest rates, living benefits, and UL work. It took about 45 minutes to an hour for this presentation, before even showing the pricing. I feel that it took that long to get the prospect to start to trust me. Either way, building rapport is important in either industry. With the more responsible professionals that we meet with during mortgage protection sales, you will need to build more confidence and trust than with final expense sales. You’ll also need to show lots of professionalism and throwing name brands into the equation doesn’t hurt either.

The final expense presentation is a lot different than the mortgage protection sales presentations. With final expense, we simply find the need for the insurance, separate what we do from all the other insurance agents that they’ve already met with, and find an amount of insurance that they can afford. We base their payment draft date on when they receive their social security moneys and we make sure that the carrier we use is able to accept the form of payment that they have. A lot of FE prospects do not have the capacity to balance a checkbook and get their social security benefits on a direct express card or other debit cards. Some carriers do accept these forms of payment but remember, the typical fixed income final expense prospect isn’t going to be responsible enough to keep enough money on their card for the insurance premium each month.

Persistency with Mortgage Protection Sales vs Final Expense

When it comes to persistency and placement, final expense sales are the lowest in the life insurance sales industry, around 75% for agents that work hard for their clients. Meanwhile, mortgage protection sales have the highest, often 97% persistency and even higher! It’s all about the target market. With final expense, we are targeting low income seniors and, in many cases, working with folks that are illiterate and raised poor. Here’s the kicker. These folks are also the ones that need the life insurance the most. I’ve noticed that people living in the urban neighbors tend to see the importance of burial over cremation. These whole life policies are often the only way for them to give a proper send out for their family members. For a lot of our clients, these small whole life policies are a sacrifice and can be very difficult to keep up.

With mortgage protection sales, we are targeting a market that is the exact opposite of our typical final expense prospects. The typical mortgage protection policy is sold to people that in most cases, are responsible and have lead a more financially lucrative life. They are often semi-retired folks, living off a pension and other forms or income, or younger working class. If you’re targeting the mortgage protection sales market, you will be meeting with doctors, attorneys, and other responsible professionals. For this reason, you had better be a talented sales person. You can’t get away with selling these folks if you don’t know exactly what you’re doing and come off as a smooth professional. This is just another reason why the final expense sale is a much easier target market than mortgage protection. Without proper hands on training, mortgage insurance sales can be a bear for a new insurance agent.

Why FE Pays Better than Mortgage Protection Sales!

This is all part of the give and take between final expense and mortgage protection sales. You see, with final expense sales, we get commission levels that are at 100% and even higher along with renewals that can be over 7%. Remember, the typical final expense sale will take more service work and babysitting. The persistency is a lot lower with final expense, so it makes sense that you can get higher commissions. With mortgage protections sales, term life and universal life will generally be 10 to 20 points less unless it’s a super competitively priced product that is easily underwritten. These products will often pay around 20-30 points less than the typical final expense sale. You see, someone must pay for the deal. It’s either a more expensive product for the client that pays more to the agent or a more competitive product that will pay less.

Fully underwritten products pay even less. Remember, the insurance carrier must spend money on the paramedic exam. They are spending money on the blood and urine tests. Then there is the underwriting. With fully underwritten products, doctor and medical records are being pulled and the underwriter is looking for anything that could be a potential reason for an underwriting table rating. It doesn’t matter if it’s final expense or a mortgage protections sale, when it comes to fully underwritten products, the process is more extensive. Fully underwritten life insurance is sold to people that want more insurance for their money. With final expense, the typical products go up to $35,000 face amounts. If you have a super healthy senior, you can get them 50 to 100k of insurance, or even more! Younger folks can often qualify for millions of dollars of UL or Term insurance.

Training – Final Expense vs Mortgage Protection Sales

When I was recruited into the life insurance industry for mortgage protection sales, I started as a captive agent. This made it a lot easier for me to cut through the learning curve as I had one product to learn. It was a universal life policy that had lots of flexibility and could be used for healthy seniors and super young people too. Thankfully, I was required to go into a local office for daily face to face sales and product training. This gave me an edge and made it easier to cut through the learning curve. When I stepped away to become an independent, it was like I had to start all over. There were several products that I looked at and had to work with, so I could compete in the market. This was difficult as there suddenly were multiple moving parts and each product was different.

Within just a few months of being an independent mortgage insurance sales person, I found final expense. The underwriting was super easy. I wasn’t used to. This made the learning curve very short compared to mortgage protection sales. With final expense sales you get to do a point of sale interview at the end of each sale and find out if the prospect is approved as applied for right then and there. I wasn’t used to this simplicity. The FE presentation is also very easy compared to MP. Oh, and don’t forget about the clientele. The typical final expense prospect turned out to be a lot easier to close than with mortgage protection sales. Apple to apple, learning how to sell final expense is a lot easier than mortgage protection. The learning curve is much shorter as the presentation and products are easier to learn.

Independent Agent vs Captive

There will always be a give and take as an independent vs captive life insurance agent. It doesn’t matter if your selling final expense or doing mortgage protection sales, there are pros and cons to being captive. Each company is different too. For me, being a captive agent at the beginning of my career was exactly what I needed. The idea of learning one product along with the face to face mentoring and training is unbeatable. When I speak with newly licensed agents, I usually suggest that they work with a local insurance agency that can give them hands on training, like what I first had. To me, this is the give and take about being captive. If you’re going to work with a company that gives you average commissions below 100%, they better be holding your hand through the learning curve. This makes sense if you’re a captive agent.

Unfortunately, most of the agents that we speak with are usually at sub 100% commission levels and still don’t get the hands-on face to face training that they should be getting. The idea of being an independent agent means that you are truly independent. You can do what you want and sell any products and carriers that you chose. The typical independent mortgage protection sales and final expense life insurance agent doesn’t need much help. They already know the system and are generating leads on their own and have higher commission levels than captive agents. Therefore, you hear people saying how much better it is to be independent. Here’s the problem. When you read or hear blanket statements about how it’s better to be independent, in most cases the words “if you already know what you’re doing” must apply. Starting off as an independent from day one, usually doesn’t work.

Mortgage Protection Sales MLM Model

There is a lot of controversy about using mortgage protection sales and final expense as a recruiting tool for a multi-level marketing business model. One of the problems with this model is that this model makes it very difficult to make the same commission as anyone that came before you. You see, with mortgage protection and final expense, your commission level is always going to be less than the person that recruited you. Is this fair? Well, yes, after all, you had to be recruited by someone. Here’s the problem. If you are 5 levels or managers below the top, you can probably just look around and find higher commission levels without even looking very hard. So, if you want to be a producer and make money as a professional insurance agent, there are a lot better options than these MLM captive scenarios.

I know this all sounds negative, but it gets worse. Let’s say your goal is to get licensed and start to build a team of agents right from the start. You start to learn the process of mortgage protections sales or final expense sales. Meanwhile you’re recruiting agents! One of the problems here is that you really have no clue. Who in their right mind is going to want to work under a manager that doesn’t know the business? Here’s something else to think about. Everyone has the internet. At some point, every single one of your down line agents will read an article like this one or see a video like the ones we have on our YouTube channel “Final Expense Trainer”. Once they do that, they will realize that they can get much higher commissions elsewhere. It’s a slap in the face or a punch in the gut!

MLM Success Rates

Here is some good news. I truly believe that the right person with a very strong work ethic can be successful with mortgage protection sales by using the multi-level marketing business model. This type of insurance sales recruiting model must work or there wouldn’t be several companies doing it. Here is what I realized during my very short stent with a mortgage protection MLM. I went to several meetings and a conference. When it all came down to it, I realized that the Up-And-Coming, high profile agents that would speak at these events were making less than 100,000 per year. The more research I did, the more I realized that out of the hundreds of agents I was seeing and meeting, only 3-5% of them were making $100,000 or more. This is when I started to feel scammed and used. It’s hard to un-ring that bell.

Here is the crazy part of my experience. A lot of the insurance agents that I met and got to know, worked hard. So here they are, working their asses off. Week after week, month after month, year after year, and only making $50,000 to $60,000 a year. Now I’m talking about the agents that are willing to put in 50 hours a week. The part timers, “in my opinion anyone who works less than 50 hours a week” are only making 30-40k per year. This is one thing that made it easy for Mariana and I to start United Final Expense Services. We know that we can offer agents high enough commission levels and multiple lead programs, so they can work as hard as they want and still make a good living. We have final expense agents that work part time and make $50,000 a year and even more.

The Independent Agent Business Model

Once you have been around a while, you will most likely end up being an independent life insurance agent. This is hard if your selling mortgage insurance as it’s harder to generate leads for mortgage protection sales. With final expense, you can generate your own leads or even cold door knock from a list. Prospecting is a big part of our industry, so you do need to get comfortable asking people that you meet and sell for referrals. If you’re talented and a very good communicator, you will be able to all kinds of sales. Mortgage insurance sales, final expense, term life, universal life, and don’t forget about Medicare! With the final expense prospects, cross selling Medicare advantage, Cancer policies, or Medicare supplements is easy to do. You’re already working with people who will absolutely need a Medicare plan at some point.

If you think about it, all your sales, whether mortgage protection sales or FE, are eventually going to be potential Medicare sales. We all get old and will all need some type of Medicare plan eventually. Here’s something else to think about. If you get into final expense sales, you will instantly have a book of business that you can work later for Medicare sales. The way I see it, we currently have thousands of potential Medicare sales just sitting in our file cabinet. All we need to do is call our existing clients and ask them if we could stop by and go over some of the changes that are happening with Medicare. Always follow the Medicare rules. Here’s how I see it. Who is your current life insurance client going to trust more, you, or someone who doesn’t send them a Christmas card each year? Lol

Does the Mortgage Protection Industry Lack Transparency?

The short answer, in my humble opinion, is yes! With mortgage protection sales, just about every insurance marketing organization recruits with a severe lack of transparency. Actually, I have noticed that most Life Insurance Marketing Organizations are lacking in transparency. When I go back to my first years of insurance sales, I can’t ever recall filling out an application for a life insurance company where the first-year commission levels were in black and white. This is sadly the norm in our industry. Well, so what, you can always cancel your appointment if you realize the commission level is not what you thought it was, right? Wrong! Unfortunately, in order to transfer your contract from one IMO to another, you have 2 options. You either get a release agreement signed by the top marketer or owner of the IMO, or you simply go 6 months without writing business with that carrier.

This is why you always want to make sure that you see the first-year commission levels in black and white for the product you are going to be selling. Nowadays, most insurance agencies are using the SuranceBay contracting portal. This thing is awesome. In the old days, you had to fill out paperwork for every company that you were interested in getting appointed with. With SuranceBay, you simply create a profile, upload your information, answer the questions, and send out carrier requests. The reason I bring this up is that any IMO that you are contracting with can simply do what we do. We put in writing the first-year commission level of each product in the same email that has the link for the SuranceBay contracting portal. That way everything is in black and white before you apply. We also grant releases which is unheard of with MLM’s.

Final Thoughts on Mortgage Protection Sales / Final Expense Sales!

When it comes down to it, there are several options for you to choose from. You can learn mortgage protection sales from one of the MLM companies and see if it’s a fit for you. If you would rather work during the day, these companies can also get you final expense leads to work. You can go to a captive company and learn one product as this may be easier if they have a local office with agents that you can ride with. You can also speak with a General Agency like ours and see if you’re a fit with our sales program. We probably won’t be a good fit if you want to recruit agents immediately. Remember, we only specialize in final expense. At United Final Expense Services, we expect you to be a professional at final expense sales before you start to recruit new agents.

With final expense sales we can give you higher commission levels than mortgage protection sales. The leads for final expense are a lot easier to get and there are multiple types of lead options to work. With mortgage insurance sales, the only viable lead is the Direct Mail lead. Direct mail mortgage protection leads cost over $50 to generate and can be very difficult to generate. There aren’t any reputable lead vendors that I can name, who will just sell them to the general public. You will likely need to be contracted through the company that is selling the leads for access to their leads. In other words, being an independent mortgage protection sales agent is almost impossible as you will always have to take a haircut on commissions in order to access regular weekly direct mail leads.

Final Expense Sales with Top Commissions

If you have any questions about our commission levels that start between 100 and 120% for our final expense carriers, feel free to email Doug at doug@ufesonline.com or just fill out the contacts form here. At United Final Expense Services, our contracted agents have access to multiple lead programs. We have all the top final expense carriers and products, and our 30-day online training platform. Our final expense sales training program is designed to get agents up and running in 30 days. We firmly believe that giving agents all the tools necessary for success, takes away any excuse that you can have for not being able to have a lucrative career with final expense sales.