how to sell disability insuranceBusiness relationships don’t have to flow one way and one way only. When you give someone your business, it can be natural to request their business in return. It’s called reciprocity, and it can be a powerful disability insurance sales tool.

Wait – Isn’t That a Little Old School?

OK, let’s address the elephant in the room. The idea of a you-scratch-my-back-I’ll-scratch-yours sales funnel can sound pretty old school, and maybe not in a good way. But we’re not talking about making quid-pro-quo, under-the-table deals. We’re talking about building relationships with people in your community and using basic human psychology to make more sales.

The Psychology of Reciprocity

Reciprocity is a natural human tendency. According to an article in Psychology Today, the rule of reciprocation is a universal tendency that humans have to reciprocate when given a gift. It’s so powerful that it can be used against people, but it can also be used beneficially, and all highly successful relationships include reciprocity.

It’s hard to overestimate how powerful reciprocity really is. An NPR article gives some examples to show how the rule of reciprocation impacts our relationships. In one example, Philip Kunz, a sociologist at Brigham Young University, sent Christmas cards to 600 strangers and ended up getting more than 200 replies. In another, Robert Cialdini, an emeritus psychologist at Arizona State University, found that servers who bring candy with the check can increase their tip. Cialdini also found that providing free pre-printed mailing address labels with requests for donations increases the rate of people who donate by 18% to 35%.

Why It Makes Sense to Ask for Business from the People You’ve Given Your Business

Reciprocity is human nature, so it makes sense to use it in your sales strategy, but that’s not the only reason to pitch to the people you give your business.

Insurance sales agents always need prospects. A logical way to find at least some of those prospects is to focus on the people you know, including people you know through business dealings.

  • One, you’ve already established a relationship with these people, so you don’t have to bother with introductions.
  • Two, these people need insurance. They work for a living, so they probably depend on their paycheck, and that means they can benefit from paycheck protection. Many of them are also small business owners who could benefit from business overhead expense insurance.
  • And three, this tactic uses the rule of reciprocity, which can nudge the odds of success toward your favor.

The Rule of Reciprocity in Action

Now that you understand the wisdom of this sales technique, let’s imagine how it could play out in real life.

Let’s say you’re having your house remodeled. The contractor is at your house every day for a couple of weeks, or however long the project takes. The job is great, and you’re happy to recommend him to any of your friends who might be interested in having their homes remodeled. You ask for some business cards – and you also offer one of your own, explaining that you’re an insurance professional and you’d be happy to review his individual disability and business overhead expense insurance needs. Alternatively, you could send him a letter explaining why coverage is important and offering to set up a meeting.

This same strategy can be used for many of the various professionals you give your business: hair stylists, accountants, chiropractors … The list goes on and on.

Other Ways of Promoting Reciprocity

There are other ways to leverage the rule of reciprocity in your sales technique.

Many professionals give out free gifts, and as the aforementioned studies involving address labels and candies show, this can be an effective way of making people more generous and receptive toward you.

Even free advice can prompt the drive to reciprocate, whether it’s a blog that’s packed with useful information or a one-on-one meeting to discuss coverage needs. When you give people useful information, you’re giving them something of value, and that may make them want to reciprocate.

Of course, not everyone will buy insurance from you just because you did something nice for them. They might already have coverage that they’re happy with, they might not be able to afford coverage, or they might have another reason for deciding not to purchase. But if they do decide to purchase coverage, the good will that you’ve established can make it more likely that they’ll decide to purchase through you.

Using sales psychology and the rule of reciprocity can help you make more disability insurance sales. If you need more support, DIS is here to provide it. Contact us for assistance.

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