Financial planning is the process of setting goals and meeting those goals through the successful allocation of financial resources. This process applies to the insurance selling business, since part of a financial planner's services includes selling insurance to insure clients' assets. The Certified Financial Planning Board of Standards sets forth rules and outlines various processes that are considered generally accepted approaches to financial planning. They outline a process that is valid for all aspects of financial planning, including insurance.
Establish client relationships. This step in the planning process gives you the opportunity to build rapport with your client. You will also discuss what work you'll do for the client (business insurance, personal insurance, etc.). Any fees separate from the sale of the insurance policy are discussed. Normally, a fee is charged only for complex insurance planning or business planning.
Gather data from the client. This involves getting information about the client's financial situation, including current insurance policies he has in force, his investments, his debts and his disposable income. In the context of insurance planning, you'll discuss how the client feels about risk. You'll also help him determine what his insurance goals and needs are.
Analyze the client's data to determine how she will meet her insurance goals. Use illustration software your insurance company provides to run insurance quotes. Determine what type of coverage she needs for life insurance, as well as liability or property and casualty. For life insurance, you must determine whether a term life, whole life, universal life or variable life insurance policy would be appropriate based on the risk tolerance of the client and her financial goals.
Develop and present recommendations to the client. All of your analyses and insurance policy illustrations should be organized and explained to him in simple terms he can understand. When making your recommendation, you may also need to help the client with budgeting so he can afford to purchase the insurance policy he needs.
Implement the recommendations and make the insurance sale. Have the client fill out an application for life, auto, home, liability or any other type of insurance she needs and collect all pertinent data for processing the application. This includes all state mandated forms in addition to the basic application.
Monitor the recommendations. Periodically, you should review your client's insurance coverage and advise him regarding how much insurance he needs based on his assets and financial goals.