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Securities can help you become more valuable to clients.

It's crazy to be in the insurance business and not participate in the securities business. You spend all week marketing and giving sales presentations about prospects' financial assets and you gain their trust. Then you gain only part of their business. Why not gain it all by taking care of their securities business also?

The sale of insurance and securities is conceptually identical. In both cases, you take a check now for a financial benefit in the future.

Once you offer securities, you also enable yourself to finally take a "client-centered" approach. If you now have a limited number of products and services, you will naturally be product-centered. By becoming a virtual smorgasbord of insurance and securities options, you can focus on the client because no matter what their needs or desires, you have a solution.

You have three options for participation in the securities arena:

Obtain a Series 6 license. You must join a broker-dealer and they will sponsor you to sit for the FINRA exam. Depending on your knowledge, study time can be 20-50 hours. Or, you may just take a cram course where you take a 40-hour class. It's a simple fact that the more products and services you offer, the more business you will do. You don't learn very much about advising people when you take this exam so you'll have to do some self-study. These are two of the best books: Bogle on Mutual Funds by John Bogle, and The Variable Annuity Handbook by The National Underwriter Company.

Note that you will be subject to the FINRA roles and also rules of your broker-dealer. You may find these frustrating because:

* You cannot send letters to clients without review of your broker-dealer.

* You will find that your communication becomes much more restricted (any seminar, ad, direct mail piece, etc., has to have your broker-dealer's approval).

* You may find that your broker-dealer also will monitor your marketing as it affects your non-securities insurance business (as your insurance business and investment business may become indistinguishable).


Obtain a Series 7 license. Once you pass this exam, you may sell mutual funds and variable annuities as well as individual securities (stocks and bonds) and get involved in direct participation programs (real estate, oil and gas and a variety of other business opportunities). Even if you never want to sell a stock or bond, there's good reason to take the Series 7 exam rather than the Series 6 exam:

* You will spend about the same amount of time preparing for the exam.

* When you meet prospects, you can liquidate their stocks and bonds so that the money becomes available for mutual funds, variable annuities or insurance products.

* You don't know how your career will change and having greater flexibility is always an asset.

Without the Series 7 license, you won't be able to liquidate or do any transactions with stocks and bonds and you will find this very inconvenient. You don't want to tell your new client, "go back to your old broker and tell him to sell these stocks and then bring me the check."

Become an RIA. The investment business is moving more toward fees and away from commissions. You can become a Registered Investment Advisor (RIA) and collect fees. When you become an RIA, you do not need a broker-dealer and you are not regulated by FINRA.

Starting out, you register with your state. In most states, to become an RIA, you must pass the Series 7 and Series 66 exam. As an RIA, you may not accept commissions (only FINRA licensees may receive commissions). Rather, you get fees. You may charge fees for your time (e.g. for financial counseling or for a financial plan), and you may charge fees for money management services.

Whichever way you go, by adding securities to your offerings, you can gain more revenue per client and more clients as a result of a client-centered approach. Your clients will respect that life insurance is no longer your answer for every financial goal and you will do more business.

Bob Richards is Marketing VP at ProspectMatch [] where he helps agents and advisors pack their appointment calendar. He is an active blogger on financial marketing and sales, and you can find him at
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Author:Richards, Bob
Publication:Life Insurance Selling
Date:Nov 1, 2010
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