Many advisors operate in markets where there is a prevailing, unfavorable perception about insurance because people were burned by inferior products in the past or had a negative experience with an agent pushing for a sale.

Even clients who want to delve deeper into their existing coverage to learn more about how well they’re protected are reluctant to disclose details about their policy because they’ve already been told by people outside the profession that insurance is useless. In Kon Kim, a nine-year MDRT member from Seoul, Republic of Korea, knows this uneasiness exists and that he must give his clients a rationale for opening up to him. For this, he uses a checklist.

“My approach empowers clients to make informed choices by imparting a solid understanding of what basic insurance is. While it may take more than one consultation for clients to fully grasp and select an insurance policy, they will feel more knowledgeable and in control,” Kim said.

His checklist covers five key points.

1. It starts with providing clients an objective look at their policies by presenting trends in demographics and health care to see whether their coverage is adequate or needs an upgrade.

“The future of their insurance needs should emphasize health care because baby boomers are living longer but are not living healthier,” Kim said. “People buy insurance with the expectation of receiving a payout, and this implies that the time of purchase is distinct from the time of payout. Consequently, financial advisors must ensure clients select the right insurance for the right moment. Also, advances in health care will enable clients to receive quicker and more accurate diagnoses and improved treatment, and the right insurance can help clients avail themselves to this care.”

2. The second checklist item is educating clients about the distinction between life insurance and other general insurance. Clients have a limited budget and want to know that they are getting the best value for their investment.

“Since life insurance and general, or nonlife insurance, have key differences, it is important to guide clients, so they obtain the right coverage. The point is to clearly communicate the differences and to accurately check each part,” Kim said.

3. The third checklist item dives deeper into risk-based insurance products by exploring the pros and cons of general illness and critical illness coverages.

“Here I emphasize what should be the priority. While critical illness insurance was highly popular in Korea in the past, it came with numerous sensitive issues about what was actually covered,” Kim said. “Therefore, it is essential to prioritize enrollment in general illness insurance, which offers broader coverage.”

4. Fourth is comparing policies with nonrenewable and renewable options so clients are aware of the advantages and disadvantages of each.

5. Kim combines point four with the fifth checklist item: the definition of practical diagnostic funds. The term refers to funds that would be required for clients to receive quality treatment from a good doctor at a reputable hospital and ultimately return to work. Such funds should amount to the minimum Korean income standard of 60 million won. If the coverage offers less, then supplemental coverage is recommended. If coverage offers more, then upgrading the insurance is advised to provide for better treatment options.

“I tailor the approach to each client, as insurance premiums for most households cannot be raised indefinitely,” Kim said. “I strategically design plans by thoughtfully combining nonrenewable and renewable products to ensure that diagnostic and treatment expenses are available during their active working periods. When explaining these five checklist items to clients, most become curious about their own insurance situations. They  begin to talk about their existing insurance, and it becomes easier to advise them.”

The checklist process has helped Kim adjust how he matches clients with the right insurance and stand out as an advisor.

“As my career progressed, I found myself frequently grappling with a question that had never crossed my mind during the early days: Do the insurance policies I sold to my clients actually provide the promised insurance payments?” Kim said. “I made this checklist to answer that question, and now I can confidently present insurance to clients. My clients ask, ‘Why do you talk so broadly about insurance and even present a checklist when we are supposed to simply talk about our insurance policy? I’ve never seen a financial advisor like you.’ However, my clients come to a deeper understanding and start to think, this financial advisor offers a unique approach to explanations compared to other advisors. In this way, I have been able to obtain more information and provide solutions for them.”

Kyuho Nam writes for Team Lewis, a communications agency assisting MDRT with content development for Asia-Pacific markets. Contact mdrteditorial@teamlewis.com.