Top Myths of not Offering Planning & Insurance

Several years ago, a branch manager asked me to come present to his top advisors with a specific topic he already had in mind. He said, “rather than discuss some advanced wealth management planning technique, I want you to talk about the top reasons financial advisors do not do planning and insurance business.”

Because this is my area of expertise, I was a little underwhelmed and responded sheepishly, “gee, I can hardly wait to talk about why people would not want to work with me.” He laughed and told me to trust him.

I’m glad I did. The meeting went extraordinarily well, and I learned a lesson. There are indeed some myths out there about this segment of our industry. I’ve now made that same presentation many times to several firms across the country, and it is always well received.

In this article, we’ll address those top reasons financial advisors not do insurance business and hopefully dispel some of the myths associated with those services.

#1:  My Clients Aren’t Interested in Talking to Me about Planning and Insurance

Numerous studies have shown that in fact, high net worth (HNW) clients do indeed want to talk with their financial advisors about planning and insurance. If you are their trusted advisor, they look to you for this advice. They do not look to their attorney, their CPA or their insurance agent for this.

They want advice from their financial advisor. That means an even more powerful connection can be made with your best clients because you’ll learn about their goals, desires and wishes. As their advisor, you’ll learn what’s most important to them, and they will be enormously grateful.

#2: I Don’t Want to Look Like I’m Pushing Insurance on My Clients

I totally understand this one, but if you’re working with the right planning specialist, you will never be viewed by your clients as pushing insurance on them. How’s that possible? By working with an outside specialist, you will be positioned as the objective advisor. This is key.

When a planning discussion turns to insurance, the specialist will smartly position the financial advisor on the same side of the table as the client. It’s a subtle yet powerful dynamic. The specialist will be presenting to you as much as the client. As the specialist makes recommendations, the client will be listening along with their financial advisor.

Once the specialist leaves the room, the client will look to you as their financial advisor and ask your opinion. Never once will the client feel you were pushing them. Instead, they will feel you are objective and the one they look to in selecting the appropriate choice on the insurance.

Again, it’s a subtle thing. But so many financial advisors we’ve worked with have seen the power behind this approach and swear by it.

#3: I Don’t Understand Insurance

Over 80% of financial advisors have never dropped an insurance ticket. That’s a pretty staggering number. Consequently, there is not a great deal of experience out there in this area of wealth management. It’s only human nature. If you don’t understand something yourself, you’re certainly not going to be the one to bring it up to your best clients.

This is yet another reason why financial advisors should consider partnering with a planning specialist. Think about it. You have specialists in all major areas who you lean on in investing and asset management. Because you can’t know everything, you need and rely on these people.

The same applies in the planning and insurance world. It can be complex, but if you’re working with the right specialist, they bring that additional needed expertise. Specialists know how to navigate the minefields. They have a network of estate planning attorneys they can recommend to your HNW clients, know how to navigate the world of insurance underwriting and paperwork and understand which trusts are appropriate for each situation and which are not. The list goes on and on.

While on the outside, insurance may appear to be overwhelming. That’s why working with the right specialist in the planning and insurance arena is the key. Just as you work with the specialists in the investing area, you can work with the right planning specialist in insurance.

#4:  Insurance Products are Confusing

Insurance products are only confusing if one doesn’t dig a little deeper. With the advent of so-called guaranteed policies, insurance products have become much simpler. And of course, simpler is always better.

A guaranteed product boils down to this: the premium, the years of payment and the death benefit are all guaranteed. That’s it. End of story. It doesn’t get much simpler than that.

However, insurance products go much further than that, but don’t have to be confusing. The right specialist should be able to explain how particular insurance products work in plain, simple terms that anyone can understand. If they can’t do that, they are the wrong specialist.

Also, the real experts out there, design insurance strategies with a very conservative approach. That way the benchmarks or bogies the policy must hit to perform are low. Which translates to no surprises for the financial advisor or the client down the road.


No longer is the wealth management world as simplistic as it once was. Back in the day, your broker did stocks and bonds, your CPA did taxes, your attorney did legal work and your insurance agent did insurance. Now, all of these people are in the asset management business, gunning for your clients’ assets and trying to find ways to set themselves apart. So often, they use “planning” as the angle to capture your clients.

So many financial advisors have learned that one of the best reasons to offer planning and insurance as part of their business is defense. “Defense” meaning that it walls off outsiders trying to poach their best clients. They also learn that while this side of the business offers many benefits to their affluent clients, it also brings many benefits for the financial advisor and their practice. These benefits include:

  • Building tighter relationships with their best clients
  • Uncovering additional AUM by going through the planning process
  • Making introductions to the next generation (who will be inheriting this wealth)
  • Increasing referral opportunities

What is probably most significant to financial advisors when calling in a specialist to provide planning and insurance strategies, is that their clients see them in a new way. Clients see not just an asset manager, but a true, objective financial advisor.

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