Back in 2012, I attended an education conference in Las Vegas. Frankly, I was disappointed at how little product and tax education that was being provided. Instead of education, it seemed that the entire conference was focused on sales strategies (ie. increase sales, increase production, etc. etc.). Honestly, I was having a really hard time sticking around.
On the second day of the conference, there was a speaker who during his ‘sales-focused’ session, used the phrase, “Prescription before diagnosis, is malpractice.” For those who do not know, I spent the first 8 years of my career working directly with physicians, so I started thinking really hard about what that expression meant in the context of my business (insurance/planning).
This was my conclusion………..in my opinion, the reason so many people hate talking to insurance agents (investment advisors aren’t too far behind), is that traditionally, insurance agents “prescribed” insurance products to their clients. No time or effort was used to diagnose what insurance (if any) a person/family needed (often, the only insurance discussed was mortgage insurance). Worse still, professionals have never been required by their governing body for a needs analysis or plan before “prescribing” their insurance and/or investment product to make sure the client was well educated and informed (although things have been changing in recent years).
In the Financial Planning industry, “diagnosis” comes in the form of a financial plan and tax planning. I rephrased the old expression to read, “Insurance and/or investment products that are sold, before a financial plan and tax planning, is non-compliant”.
My point is simple…..insurance should not be “prescribed” until a financial plan or needs analysis has been complete. The case studies in this blog are examples of detailed “diagnosis”.
If you have never gone through the financial planning process, or have never had an insurance needs analysis completed, I strongly recommend reaching out to your financial advisor and book a meeting.