When you’re looking to find out information on leads the first step is to look at the lead type. Each lead type should be evaluated differently with a different set of questions you need to ask. Let’s look at each lead type separately.
Directmail Life Insurance Leads
If you work both the Final Expense and Mortgage protection markets and you’re checking into a new directmail lead source realize there is a completely different set of qualifiers and questions. The reason directmail is the most expensive is the steps a prospect must take to get information. The more steps needed the more qualified the lead.
For Final Expense – you need to find out what age group are they mailing. 50 to 75 is standard. Next is income. In my opinion this is most important; the sweet spot should be $15,000 to $50,000. Those vendors that use $0 to $30,000 is a waste of your time as most folks in this bracket have no bank account or cannot afford coverage. While you will sell some, the return on investment (ROI) will be very low.
Where ever possible use zip codes to determine the area you want to work as opposed to counties. Most large counties contain several zip codes with only a few of those viable to working Final Expense. By using zip codes, you can narrow done your target market increasing your ROI.
Mortgage protection has only one qualifier from the vendor, mortgage amount. Some use everything over $100,000, others use between $100,000 and $500,000. These will differ depending on location. For example, California might be $200,000 to $800,000 due to housing cost.
Next, is the age of the data. Current mortgages are those closed within the past week. The data can also be six months to 15 months old. Personally, I like aged data vs. new mortgages. The competition in the household is much lower. It’s not unusual to find a prospect with several “letters” from other agents when working current mortgages.
As it’s up to you to choose the area look for mortgages, in most areas of the country, that fall under $400,000. Higher mortgages or more affluent areas will return the least amount of leads because they most likely already have a financial advisor they’re working with.
Using zip codes to generate the data will help with return-on-investment (ROI) as you can narrow down the areas with mortgages that return the range you’re looking for. However, most vendors use counties. You should stay away from counties with new mortgages in excess of $400,000; more often then not these people do not return mailers, unless you’re in a state like California where most mortgages in all areas are around the $400,000 mark.
Phone-in Life Insurance Leads
Not to be confused with telemarketed leads. Phone-in leads are generated from a directmail piece but, instead of a prospect mailing back the lead they are directed to call a phone number. These leads are typically much less expensive as a directmail campaign but, can have similar results of success.
Quality leads will include the mortgage information on the mailer and when the prospect calls, will need to complete a few questions successfully to become a lead. These leads are also ordered by county and generally are for mortgage protection only. Agents need to follow up with leads within hours, not days, of receiving them. The shelf life on these is very short; after a couple weeks they’ll become door-knock leads.
Telemarked Life Insurance Leads
These can be tricky as quality is determined by the vendor. Some will pass long prospect information ever if the prospect says they’re not interested. There’s not much an agent can do as the lead vendors only offer a replacement lead if the phone number or address is fictitious.
Its this reason the cost of these leads are quite low when compared to a directmail campaign. The best way to try out a new vendor is to order the minimum required to check them out. It is very rare you won’t make any sales; you just may only make 1 or 2 times your investment.
When you find a good quality vendor, stick with them. They can be difficult to find so do some research by visiting insurance forums and other agents you may know. Be cautious of Googling “reviews” on a vendor reading between the lines. An agent that blames the lead for their lack of sales could easily be the result of their lack of skills or poor work ethic.
It is best to connect with these leads within hours of receiving them. Waiting even one day can be problematic. These are best for final expense but are also offered in mortgage protection.
Facebook Life Insurance Leads
These are the latest and greatest in lead generation. The quality is all over the board as vendors are trying to get it right. Vendors run ads generating leads in a given area and are forwarded to agents, generally, in real-time. These are best for final expense; however, mortgage protection will be coming soon.
The difference in vendors is knowing how many steps a prospect must take to generate the lead. The more steps it takes for a prospect to complete the better the lead. For example, if the ad prefills the prospect information when they click on it with the only question asked is the desired benefit amount their looking for then they hit send, that’s only 3 to 4 steps.
That’s not a great lead, better is when they click on the ad, they are taken out of Facebook to complete a form and answer a few questions before they click the send button. Even better is if the questions refer to life insurance. These are a much more qualified lead, but still need to be contacted within an hour or two of receiving them to be successful.
Aged Life Insurance Leads
I would not recommend using aged leads for final expense unless you can pick them for only a few dollars pre-lead. It will take about a 100 aged FE leads to generate 3 or 4 sales. If you’ve only spent $300 or $400 on the leads you should do pretty well on ROI.
For mortgage protection these leads can be very lucrative for agents to work. What to remember is that these leads can be 12 to 24 months old. The leads have been previously sold, in most cases, to another organization. The prospects may or may not have purchased a policy, hence the reason they are very inexpensive.
If you’re an agent on a limited budget or just need a few more appointments in a given week, then they’re perfect. You will close some of these leads making your ROI soar. Remember, even with fresh leads agents close anywhere from 50% to 70% on average meaning that 30% to 50% of these leads are still viable. The timing could have been wrong at the time; the agent’s presentation may not have connected with the prospect or any number of reasons the prospect decided not to buy on the original lead.
When it comes to working leads the rule of thumb is: The lower the cost the more work it takes to close the lead. For example, it may take 3 or 4 times to set an appointment on a fresh lead. It could take 6 to 9 times on an aged lead or even door-knocking them to set an appointment.There is no magic bullet when comes to lead type. They can all provide a great ROI as long as you are willing to work them and do some due diligence on vendors.