Easy Marks

I was speaking to a group of agents and offering serious advice requiring hard decisions. These agents represented an organization in trouble. One agent approached me and advised that my recommendations were solid, insightful, and correct. However, her self-awareness enabled her to advise me that my recommendations would not work because neither she nor the other agents possessed the self-discipline required to save the organization, let alone to change course to achieve success. They all wanted the Easy Button.

While her self-awareness was much greater than usual, what she was really admitting was that the agents were easy marks for con jobs. They were willing to pay for solutions that would fail, provided the “solution” was easy and required zero self-discipline.

Plenty of firms stand ready and willing to sell Easy Buttons. Easy Buttons, boiled down, are simply inadequate solutions based on not needing to apply self-discipline. Take a pill to become more educated. Get a degree without having to study. Get paid to do nothing.

Agents are often even easier marks. Tamar Frankel, of Boston University, studied hundreds of financial cons. The study found that a key to a successful con is identifying the traits common to people easily conned. In other words, the con artist shouldn’t focus so much on their skills, but on identifying people easily conned. The traits possessed by a good mark, a person easily conned, are someone who is especially trusting, possesses a high risk tolerance, and has a need to be part of a special group. A bonus trait is if the mark is trying hard to make as much money, or more, than their peers.

To be a good producer, customers must trust the person. Aside from cons, people who are trusted are often trusting of others. To be good in sales, a person must have a high risk tolerance. And do producers ever strive to be part of a special group? Absolutely! I know of a long-running con in the insurance industry based solely on this one characteristic. Are producers competitive, striving to outdo their peers? The good ones usually are.

So much money has been spent on easy button sales solutions and giving out badges of being in the top X% with zero correlation to actual success. Strategy without the discipline and accountability to execute is a waste of time and money. Strategic planning without discipline and accountability is nothing more than a different form of going through the motions, hitting the easy button, and declaring success. It’s just that the executives get paid more to press the button.

The insurance industry creates a prime environment because it rewards ineptitude well. For example, consider the national insurance company, whose total pretax operating profit over the last ten years is -$4 billion. For context, carriers have made enormous profits over the previous ten years, have been profitable every single year, and collectively are averaging about $60 billion in profits annually.  The CEO’s compensation, in the most recent year I can find, exceeded $3 million. I will charge less than that to help them lose less than $4 billion.

Why pay producers who have poor hit ratios, low retention, and small book sizes? Why pay producers full compensation to gather application data inadequately? Why pay someone to offer clients inadequate coverage? Much less, why laud them for selling inadequate coverage where the account manager had to request the data five times? And yet, they are paid well. Where else does someone get paid well for sloppy work, achieving poor metrics, and offering clients inadequate solutions? This environment fosters an inflated ego, making it easier to be conned. Seriously, how hard is it to convince someone doing a lousy job that they are geniuses and con them into buying some service?

Producers like flashy new things (otherwise called lures in fishing and con circles). They are always looking for some new trick, and there is always someone willing to sell it to them.

Recently, the number of cons targeting agents has increased materially, with some markets offering illusory coverages. In some cases, the markets are purely fake. They don’t actually have paper. They don’t have a license. And agents are placing millions with them.

Insurance agents are easily and regularly conned into buying poor advice and tools. They possess the traits con artists seek in their marks. My question to agents is this: Do you like being the mark? Do you truly want to rise above and be part of an elite unit that is truly elite? It’s in the discipline, not the flashy lures (or is this a con I’m promoting?).

Here is free advice, so you know I’m not promoting a con:

Sales discipline is more important than sleek tools. The very best sales book I’ve ever read, one that many a sales consultant has used to promote their “proprietary” models, is “How I Raised Myself from Failure to Success by Selling” by Frank Bettger. It is about 75 years old, still in print, and the discipline he shares is invaluable. (Tip: modernize his advice using Excel rather than handwritten charts.)

Next, truly learn coverages and risk. Do not just pretend to learn, but learn. Take real courses, not the CE programs that are Easy Buttons.

Third, learn to use Coverage Checklists without fear. You need coverage knowledge to do this, so part of the self-discipline is doing this in order.

And then analyze each sale for yourself. Why did it work and why did it not work? Frank Bettger’s book will help you do this.

After you've done the work, look for small additions to support your sales and agency around the edges. But quit being the easy mark.

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NOTE: The information provided herein is intended for educational and informational purposes only and it represents only the views of the authors. It is not a recommendation that a particular course of action be followed. Burand & Associates, LLC and Chris Burand assume, and will have, no responsibility for liability or damage which may result from the use of any of this information.

None of the materials in this article should be construed as offering legal advice, and the specific advice of legal counsel is recommended before acting on any matter discussed in this article. Regulated individuals/entities should also ensure that they comply with all applicable laws, rules, and regulations.