XCEL Insurance Training Solutions | STC Securities Training Solutions
In today’s competitive financial landscape, success often hinges on more than just a strong foundation in investments or market knowledge. Clients are looking for comprehensive financial advice, and they often expect their advisors to offer more than just stocks, bonds, and mutual funds.
When financial advisors expand their service portfolio to include both securities and insurance, they unlock a powerful strategy that benefits their clients and increases their own earning potential. Cross-selling has been a game-changer in the financial industry, offering a holistic approach to wealth and risk management.
Whether you’re a financial advisor considering this opportunity or an established professional looking to expand your reach, this guide breaks down the benefits of a securities and insurance cross-sell strategy and how this dual-license approach can elevate your business. Here’s why (and how) you should consider cross-selling securities and insurance.
What Does Securities and Insurance Cross-Sell Mean?
Securities and insurance cross-sell refers to the practice where a financial advisor holds both a securities license and an insurance license, enabling them to offer both investment products and insurance solutions. This unique skill set allows professionals to address the complete financial needs of their clients, rather than offering siloed solutions.
For example, instead of just building investment portfolios, an advisor can also address risk protection with life insurance, health policies, or annuities, creating a more balanced strategy for tax planning, wealth accumulation, and risk mitigation.
Why Cross-Selling Makes Sense for Financial Advisors
1. Serve Clients Holistically
Clients want integrated financial solutions, not fragmented advice. Cross-selling empowers advisors to provide comprehensive financial planning.
Clients value advisors who can help them create balanced strategies, seamlessly combining investment growth with risk management. Instead of referring clients to another professional for insurance, advisors can meet all their needs under one roof.
By offering both investment and insurance products, you can provide comprehensive financial planning that includes wealth building and protection. This dual-license approach allows you to advise on everything from retirement income to legacy planning and risk management all under one roof.
For example, a financial advisor may sell a client an IRA or mutual funds while also recommending a term life insurance policy to protect their family’s financial future.
2. Unlock Higher Earning Potential
Revenue diversification is crucial for business growth. Adding insurance to your offering opens up new revenue streams.
By cross-selling, you can tap into two revenue streams, earning commissions from insurance products alongside securities-related income. Life insurance, annuities, long-term care, and disability policies all come with commission opportunities, often paid upfront.
While securities transactions might generate fees or commissions over time, insurance sales can bring in immediate income. This makes your cash flow more predictable and robust.
3. Increase Professional Value and Trust
When clients see you as a one-stop solution for their financial needs, it builds trust and long-term loyalty. They’re less likely to seek other professionals, as your dual-license capability ensures you’re positioned as an industry authority.
A client who purchases both investment products and insurance from you is far more likely to stick with you long-term. You become their go-to financial advisor, not just their “stock guy” or “mutual fund rep.”
4. Stay Competitive
Clients expect convenience and efficiency in their financial planning. With the financial advising space becoming more competitive, offering both securities and insurance solutions differentiates you from advisors with a limited scope.
5. Expand Your Prospecting Opportunities
Offering insurance products can help you attract a broader range of clients. Some prospects may not be ready to invest large sums, but they still need life insurance or long-term care coverage. Starting with an insurance solution often opens the door to future investment conversations.
Benefits of Financial Advisor Cross-Selling for Your Clients
Cross-selling securities and insurance isn’t just about expanding your services. It’s about giving more value to your clients. Here’s how your clients benefit:
- Comprehensive financial coverage: Combine growth-focused investments with protective insurance policies.
- Streamlined service: Clients avoid the hassle of coordinating between multiple financial professionals.
- Tailored strategies: You can create truly personalized financial plans that address both short-term goals and long-term security.
What Types of Insurance Should You Offer?
If you’re considering adding insurance to your practice, focus on products that naturally align with financial planning and investment services.
A property and casualty license allows you to sell insurance policies that cover physical assets and liability protection. With it, you can sell:
- Homeowners insurance
- Auto insurance
- Commercial insurance
- Renters insurance
- Liability insurance
A life and health insurance license prepares you to sell products that focus on protecting your clients’ financial future and health. With it, you can sell:
- Life insurance
- Health insurance
- Disability insurance
- Annuities
- Long-term care insurance
Compliance Considerations
Cross-selling isn’t just about having multiple licenses. It’s about using them responsibly.
You’ll need to stay compliant with both FINRA and your state’s insurance department. Key points to consider:
- Disclosure: Always disclose when you’re acting as an insurance agent versus a registered representative.
- Suitability: Products must be appropriate for the client’s financial situation and risk tolerance.
- Continuing education: Maintaining both licenses requires ongoing CE, often with separate state and regulatory requirements.
How to Get Started with Cross-Selling
1. Choose Your State
Each state has its own rules and licensing requirements for insurance producers.
2. Take Pre-Licensing Education
Most states require a set number of training hours before sitting for the insurance exam. STC’s sister company, XCEL Solutions, has helped millions of students train for their insurance exams with flexible, productive online courses.
3. Pass the Exam
Once you’re confident with the material, schedule your state licensing exam.
4. Understand Your Products
To successfully implement financial advisor cross-selling, it’s vital to have a deep understanding of the securities and insurance products you’re offering. Familiarize yourself with policies like life insurance, annuities, and health coverage, as well as how they complement investment strategies.
5. Create a Seamless Sales Process
Start identifying clients who would benefit from both insurance and investment solutions and tailor your approach accordingly. But remember, clients should feel that you’re offering a natural, cohesive solution rather than pushing products to them.
Introduce insurance needs while discussing investment opportunities, explaining how the two work together to strengthen their financial standing.
Example script: “By pairing this investment strategy with a life insurance policy, we’re ensuring your wealth is protected for future generations while growing your assets. It’s the perfect balance of growth and security.”
6. Leverage Training and Tools
Platforms like CRM software for financial advisors and sales training courses can help you confidently manage the expansion into cross-selling. CRM software enhances organization and provides valuable client insights, enabling you to identify and proactively act on cross-selling opportunities. Paired with sales training courses, which build critical communication and negotiation skills, these tools empower you to confidently expand your services while continuing to maintain strong client relationships.
7. Market Your Expanded Services
Educate current clients and new prospects on the investment and insurance strategy approach you’re offering. Host webinars, send newsletters, or create content (like blog posts) to showcase how your dual expertise benefits them.
Overcoming Common Challenges
- Concern about overloading clients: A seamless consultation is key. Rather than overwhelming your clients with numerous options, focus on showcasing how investment and insurance strategies can work together toward their goals.
- Staying compliant: Both securities and insurance come with their own regulations. Stay compliant by keeping licenses updated and seeking advice from compliance officers.
- Gaining Product Knowledge: The best advisors are those who can confidently explain the benefits of their offerings. Consistently invest in ongoing education and certifications to maintain an expert-level knowledge base.
Making Securities and Insurance Cross-Sell Work for You
Advisors who succeed in cross-selling securities and insurance transform their practices into full-fledged financial planning powerhouses. Cross-selling securities and insurance isn’t just a savvy business move – it’s a way to become the kind of advisor clients truly need in today’s complex financial environment.
By addressing both investment and protection, you’ll boost your earning potential, secure new clients, and enhance client satisfaction. With demand for customized, holistic financial services on the rise, there’s never been a better time to add insurance to your portfolio. Don’t just advise your clients; become their go-to resource for all things finance.
Are you ready to level up your career? Expanding into insurance could be the next best investment you make – in yourself.
STC and XCEL are here to help you expand your skillset, obtain the licensing you need, and cross-sell with confidence.
