Selling Insurance: Horror Stories Will Do the Trick
by Dori SaltzmanThis is the second in a three-part series.
The plain truth is the best way to make clients understand why they need travel insurance – explaining why insurance protection is so important, even for healthy clients. And when that doesn’t work? A few real-life horror stories can’t hurt, travel sellers say.
In the second of a three-part series, Travel Market Report asks agents what messaging works best when recommending travel insurance to clients and at what point in the sale they become forceful about pushing the policies.
Agents also discussed how much insurance a client really needs and how to respond when a client refuses insurance altogether.
Keep it simple
Keep your initial approach to selling travel insurance simple, agents said.
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“I always focus on the primary reasons why people need insurance and try to simplify it for the clients,” said Jane Lee Winter, CTIE, president of Town & Country Travel in Thousand Oaks, Calif.
“Say, ‘If you get sick before you leave home and can’t take the trip, you won’t get your money back,’” suggested Sharon Emerson, CTC, ECC, owner of Cruise & Tour Planners in Seattle.
Short & sweet
Keep the conversation short, agreed Guido Adefio, owner of Bethesda (Md.) Travel Center in Bethesda.
“It took me more than 20 years to figure out how to sell insurance. There were times I’d talk about the trip of a lifetime for 45 minutes and then spend an hour and a half discussing insurance,” Adefio said. “I got really tired of doing that, so I distilled it down.”
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He now asks clients simple questions such as whether everyone in their family is currently healthy and whether the clients are willing to take a financial risk, and then makes his recommendation. “It takes about three or four minutes now,” Adefio said.
Cancellation or interruption
Among the key points to discuss with clients is protection from trip cancellation or interruption.
Emerson suggested asking clients, “If you have to interrupt your trip and come home – and maybe bring somebody home with you – who’s going to pay for that?”
Winter said she emphasizes the penalties that suppliers impose for trip cancellation.
“I tell clients there is an arsenal of reasons for why you buy insurance. You have to ask the question, ‘How are you going to feel if you lose this money?’ And you really have to explain that these penalties are real,” Winter said.
“A lot of times clients think that if they get sick, the supplier will give them their money back or that they can give the trip to a cousin. But it just doesn’t work that way. And if you buy a $20,000 cruise that’s a bitter pill to swallow; I don’t care how much money you have,” she added.
Explaining health insurance
Emerson also emphasizes the health insurance aspects of travel insurance, explaining to clients that they may not have coverage under their regular policy.
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“A lot of clients don’t know that what they have now (for health insurance) is not going to be usable if they are in a foreign country. I tell people to contact their health insurance provider to see if they’re covered, because what if you have to be medically evacuated to the nearest hospital?” Emerson said.
Playing the drama card
When simple facts don’t work, agents revert to slightly more aggressive tactics, including the use of real-life horror stories, they admitted.
“We’ve had very large clients who have had even minor incidents like a sinus infection and they can’t travel,” Winter said. “It’s not fun if you don’t get your money back. So I try to use examples of real clients who have had bad things happen to them. I don’t give hypotheticals.”
Jill Evers, of Travel and Transport in Omaha, Neb., said she also turns to horror stories when clients push back against insurance.
“When someone is on the fence, I give them examples of clients who did not take insurance and needed it. Clients often ask, if something does happen, can they write the company explaining their situation. I tell them that is fine, but most companies don’t care that their mom passed away unexpectedly,” Evers said.
Such bluntness may most effective, according to Winter. “You just have to kind of get a little bit in their face and say something like, ‘Remember, don’t come thinking you’re going to get your money back if something happens, because (a refund) is not going to happen.”
About half of Winter’s clients are persuaded to buy insurance at that point, she said.
A price point for everyone
Many clients indicate that price their reason for being reluctant to buy travel insurance. One way to overcome price concerns is to explain that insurance is available at various price points and that clients don’t have to insure 100% of the cost of the trip.
“Obviously, the older you get, the more expensive the premium, but people can choose to find a price point for insuring their trip, even if it’s covering just half of it. It’s better than nothing,” said Winter.
Recommending less than full coverage is one way some agents keep sticker shock out of the equation altogether, said Adefio.
“Unless they’re in some type of risk category or are risk adverse, I usually don’t recommend covering the full cost of the trip,” he said.
Removing obstacles
“An important part of selling is removing obstacles from the sale. If the obstacle to insurance is that it’s too expensive, and I suggest one-third coverage, they say, ‘That’s not so bad,’” Adefio said.
For most clients, Adefio recommends covering about 30% to 50% of the trip. His reasoning is based primarily on trip interruption, rather than cancellation.
“Once the trip begins, you think you’re in 100% non-refundability. But you really aren’t, because the minute they close the door on the plane, most people have used 20% or more of their trip. By day three or four, they’re already more than halfway into the trip,” he explained.
Booster coverage
Once coverage switches from cancellation to trip interruption, policies often add a 50% booster to coverage. So if you bought coverage worth $3,000, once the trip starts that coverage is actually worth $4,500, Adefio said.
“So what I tell people is, if you have to cancel before the trip, the insurance might not make you whole, but it will take the sting out of your loss. Once the trip begins, chances are that partial coverage will make you whole and get you home with minimal financial impact.”
Next time: Travel lawyer Jeff Miller discusses the legal requirements and implications of selling travel insurance.
Please see related story, Sell Trip Insurance for Peace of Mind, Yours & Theirs, Sept. 12, 2011.
