Basics of Insurance

The Definition

Insurance is a contract between two parties whereby one party agrees to undertake the risk of another in exchange for a consideration known as premium and promises to pay a fixed sum of money to the other party on happening of an uncertain event (death) or after the expiry of a certain period in case of life insurance or to indemnify the other party on happening of an uncertain event in case of general insurance.

The party bearing the risk is known as the 'insurer' and the party whose risk is covered is known as the 'insured'.

How Insurance works

The concept behind insurance is that a group of people exposed to similar risk come together and make contributions towards formation of a pool of funds. In case a person actually suffers a loss on account of such risk, he is compensated out of the same pool of funds. Contribution to the pool is made by a group of people sharing common risks and collected by the insurance companies in the form of premiums.

Insurance provides security and safety

The insurance provides safety and security against the loss on a particular event. In case of life insurance payment is made when death occurs or the term of insurance is expired. Similarly, the property of insured is secured against loss on a fire in fire insurance.

Insurance protects mortgaged property

It is the practice of the lender to insure their loan against any untoward incidents that may happen to the mortgagee. This provides adequate amount to the dependents in case of an early death of the property owner to pay off the unpaid loans. Similarly, the mortgagee gets adequate amount at the destruction of the property.

Insurance eliminates dependency

In case of an untoward happening to the husband or father, the destruction of family needs no elaboration. Similarly, at destruction of property and goods, the family would suffer a lot. The insurance is here to assist them and provides adequate amount at the time of sufferings.

Life insurance encourages saving

The elements of protection and investment are present only in life insurance. In property insurance, only protection element exists. In most of the life policies elements of saving predominates. These policies combine the programs of insurance and savings. The saving with insurance has certain extra advantages i) systematic & compulsory saving ii) the deposited premium cannot be withdrawn easily. iii) In case of a risk incidence, the insurance will pay the policy money irrespective of the premium deposited iv) certain kind of insurance premium are tax exempted.

Achieving Financial Freedom

 

Financial freedom is a term to describe the state of having sufficient wealth to live indefinitely without having to work actively for basic needs. Basically, one should have enough earning assets which would give an income that would be sufficient to meet the expenses on basic needs.

Every one wants to achieve such freedom. The following are two approaches in achieving financial independence.

1.       Accumulate income generating assets until such income surpasses living/liability expenses.

2.       Accumulate enough liquid assets which would sustain all future living/liability expenses.

To achieve the above goals, it is important to practice certain basics of wealth building principles.

1.      Maximize the earnings

This can be either through employment or through a business. It goes without saying that if we do not make any effort to earn as much as we can, we will never attain the financial freedom that we desire. While we may earn what we think is small in the beginning, we should make effort to excel at work, go back to school to increase our knowledge and actively manage our career so that our earnings increase steadily over time.

2.      Spend Less Than the Earnings

This is the best principle to achieve true financial freedom. Our expenses also grew along with the earnings. What is required is to increase the earning faster than the increase in expenses.

3.      Control the Debt

In this era of credit cards and easily accessible loans, it is easy to succumb to the allure of an easy life financed by debt. Borrowing to spend should be the last option, once should indulge in. Not all debt is bad, but uncontrolled high interest loans should be avoided.

4.      Invest regularly

We should cultivate the habit of investing a portion of the earnings regularly in stocks, unit trusts, bonds, etc. This should commence at an early stage of one’s carrier. The amount available for investment in the beginning may be small but important thing is to make a beginning and then slowly increase the level of one’s investments as their earnings grow. Set a goal for investment. The goal should be realistic and in sync with the earning potential.

5.      Make your money works for you

This is the outcome of principle 4. A regular saving would accumulate good amount of corpus. What is required is a wise way of investment in various financial products. At some point, these investments would start earning itself. Over a period, the earnings from these investments by way of interest, dividends and capital appreciation will grow faster and faster.

To conclude, if one follows the above golden principles of wealth creation, one can surely achieve the financial freedom.

Developing Self discipline

 

 Self discipline is a type of selective training, creating new habits of thought, action and speech towards improving ourselves and reaching goals. Self discipline can be developed by practice. If one wants to get up early in the morning say 5 am, what is required is to make a beginning tomorrow. Research says that anything practiced continuously for 21 days, would become a habit.

The following are some traits to develop self-discipline:

Self Knowledge

Discipline means behaving according to what we have decided is best, regardless of how we feel in the moment. Therefore the first trait of discipline is self-knowledge. We need to decide what behavior best reflects our goals and values. This process requires introspection and self-analysis. It is highly recommended to write out the goals, dreams and ambitions. Even better, if we write a personal mission statement. It is found that writing such a statement results in greater understanding of who we are, what we are about and what we value.

Awareness

Self-discipline depends upon conscious awareness as to both what we are doing and what we are not doing. As we begin to build self-discipline, we may catch ourselves in the act of being undisciplined – e.g. biting nails, avoiding the morning walk, checking emails constantly. Developing self-discipline takes time and the key here is we are aware of our undisciplined behavior. With time this awareness will help us in disciplining ourselves. This also gives the opportunity to make a decision that is in better alignment with our goals and values.

 

Commitment

It is not enough to simply write our goals and values. We must make an internal commitment to them. Otherwise when the alarm clock goes off at 5am we will see no harm in hitting the snooze button for “just another 5 minutes”. Further, it is highly recommended to put in place a system to track these commitments. As the saying goes, “What gets measured gets improved”.

 

Courage

Self-discipline is often extremely difficult. Moods, appetites and passions can be powerful forces to go against. Therefore self-discipline is highly dependent on courage. Don’t pretend something is easy for you to do when it is in fact very difficult and painful. Instead, find the courage to face this pain and difficulty. As we begin to taste small victories, our self-confidence will grow and the courage that underpins self-discipline will come more naturally.

 

Self Coaching

Self-talk may be harmful but it can also be extremely beneficial if we have control of it. When we find ourselves being tested, it is suggested that we should talk to ourselves, encourage ourselves and reassure ourselves. After all, it is self-talk that has the ability to remind us of our goals, call up courage, reinforce the commitment and remind about the task at hand. “The price of discipline is always less than the pain of regret”. Let us keep this quote in our memory and recall whenever we are being tested. It would surely change our lives.

A disciplined life will surely improve the way we think, the way we behave, the way work and the way we achieve the goals.

Prospecting for Insurance

Selling insurance is an intricate business. It requires a certain type of skills to succeed. Learning how to succeed at selling insurance requires more than sales techniques; there are a lot of considerations that go into the business aspect of insurance sales.

Referrals are important sources of business. Prospecting for new business, like any other skill, can be trained and developed into a habit. Here are some powerful prospecting tips.

Ask for referrals

When it comes to asking for referrals, timing is important. The most effective time to ask for referrals is right after you've made the sale or provided a valuable service to your customer. Asking for referrals prior to closing the sale should be avoided. Once the sale has been completed, your customer will be on an "emotional high" and far more receptive to the idea of providing you referrals.

Strike while the iron is HOT

Prospects, like food in your refrigerator, are perishable and therefore need to be contacted quickly. Develop the habit of contacting your referrals within two business days or sooner. Have a system to keep track of your referrals so they don't end up falling through the cracks. It's critical to have a computerized client contact management system to record your remarks and track future contacts and appointments. Relying on your memory alone would sometime cost you dearly.

Schedule a minimum of two hours a day for phone calls

Make your phone calls in the morning while you and your referrals are both fresh and alert. Treat your prospecting time with the same respect you would give to any other important appointment. Avoid the temptation to try and sell your product or service over the phone. Your objective for every phone call is to create interest, gather information and make an appointment. If your prospect asks you a question, get in the habit of going for an appointment rather than giving a quick response.

Qualify your prospects

Not every prospect will be interested or qualified financially to purchase your products or services. No need to waste time chasing low probability prospects. What is needed is to quickly qualify the prospects and move on.

Don't take rejection personally

Selling is a numbers game. Rejection is to be anticipated as a natural aspect of the qualification process. Learn from rejection by using it as a valuable feedback mechanism. Salespeople should not take rejection personally.

Prospecting for new business is no doubt the most challenging aspect. Daily prospecting for new business is the key to long term financial success. By integrating these prospecting tips into your daily business routine, you'll be able to surely succeed in your sales efforts.

Anger Management

“Anybody can become angry - that is easy; but to be angry with the right person, to the right degree, at the right time, for the right purpose and in the right way is not easy." - Aristotle

Anger is a natural emotion. It's nature's way of telling us that something in our lives has gone wrong. Anger occurs as a defensive response to a perceived attack to our well-being. In addition to psychological changes, like any emotion, anger is accompanied by physiological changes. When you get angry your adrenaline flows, your heart rate increases and your blood pressure escalates. Here are some tips to manage your anger.

Take a timeout

Before reacting to a tense situation, take a few moments to breathe deeply and count to 10. Slowing down can help defuse your temper. If necessary, take a break from the situation until your frustration subsides a bit.

Once you're calm, express your anger

As soon as you're thinking clearly, express your frustration in an assertive but non-confrontational way. State your concerns and needs clearly and directly, without hurting others or trying to control them.

Do some exercise

Physical activity can provide an outlet for your emotions, especially if you're about to erupt. If you feel your anger escalating, go for a brisk walk or run or spend some time doing other favorite physical activities. Physical activity stimulates various brain chemicals that can leave you feeling happier and more relaxed than you were before you worked out.

Think before you speak

In the heat of the moment, it's easy to say something you'll later regret. Take a few moments to collect your thoughts before saying anything and allow others involved in the situation to do the same.

Identify possible solutions

Instead of focusing on what made you mad, work on resolving the issue at hand. Remind yourself that anger won't fix anything and might only make it worse.

Don't hold a grudge

Forgiveness is a powerful tool. If you allow anger and other negative feelings to crowd out positive feelings, you might find yourself swallowed up by your own bitterness or sense of injustice. But if you can forgive someone who angered you, you might both learn from the situation. It's unrealistic to expect everyone to behave exactly as you want at all times.

Use humor to release tension

Lightening up can help diffuse tension. Don't use sarcasm; it can hurt feelings and make things worse.

Practice relaxation skills

When your temper flares, put relaxation skills to work. Practice deep-breathing exercises, imagine a relaxing scene or repeat a calming word or phrase, such as, "Take it easy." You might also listen to music, do few yoga poses, whatever it takes to encourage relaxation.

Seek help

Learning to control anger is a challenge. Seek help for anger issues if your anger seems out of control, causes you to do things you regret or hurts those around you. Attend some anger management classes or anger management counseling. Learn to respond to frustration and anger in a controlled, healthy way.

Sales Skills

Sales Skills

A Sale is an act of selling a product or service in return for money or other compensation. It is an act of completion of a commercial activity. We are into sale of financial products. All these years, we have been selling our own product that is retail resources. We have recently commenced sale of insurance products. While we were so successful in selling resources products, we seem to be facing little hiccup on insurance selling.

In this note, few tips are explained which we think will help us in overcoming the initial hiccup and enable us to come out with sterling performance.

1.       Researching Prospects

Chances are our customer knows plenty about us and our products.  In order to add real value, we need to know more about the customer, the customer’s family and the customer’s interests. The customer profiling is one of the tool which will support us to a great extent.

2.       Self Confidence

This is the most important skill a salesperson can cultivate. All the other skills are based on persistence. The first time you speak to a customer, they might not want to talk to you because they're having a bad day... but if you call back a week later they'll be eager to buy. Self-confidence doesn't end with persistence; if we believe in ourselves and our product, our customers will be inclined to believe as well. Self-confidence will also incline you towards a more assertive closing approach, which is vital to your selling success. Knowledge of the products and conviction will give us the Self Confidence.

3.       Planning Meetings

Every contact with a customer should end in some kind of commitment from the customer an agreement to do something that will move the process forward.  This is only possible if we plan and prepare carefully to make it happen.

4.       Creating Rapport

The first decision that every buyer makes is: "Do I want to do business with this person?"  To create that all-important instant connection, we have to be curious, personable and really care about the people we are trying to help.

5.       Asking Questions

Satisfy the customer's real need is the best way to make a sale. For that, we should ask the right question, which in turn requires right preparation. Therefore, we should meet the customer after a thorough preparation on the product and also of the customer needs.

6.       Listening Actively

This is even more important than asking the right questions. When customers are talking, it's not enough to keep our mouth closed. We have also got to keep our mind open to discover ways to truly be of service.

7.      Presenting Solutions

This means offering the right solutions to the customers.

8.      Asking for Commitment

Every meeting should end with some kind of commitment or sales. At some point of the discussion, we need to ask for the business. No need for hesitation; after all we are there to service his needs. So learn how to ask.

9.      Building Relationships

Our short-term goal is to walk "arm in arm" with the customer as they arrive at the best possible solution. Our long-term goal is to become part of that customer's financial planning.

Our team is known for performing in challenging situation. Let us learn these few tips. We are sure we would bring out the best results.

Tips for Self Improvement

We all want to improve ourselves. There is no quick fix. It requires effort and practice. Here are some useful tips which, I am sure would help you in your effort to improve yourself.

1.       Get off to a Good Start

Mind and body work smart during the morning hours. Early start will give an advantage to your daily routine. Learn to get up early and start the day.

2.       Keep a Schedule

It is a good idea to write down the tasks you need to achieve in each day. As you complete them, tick them off. You should not, however, feel like you are bound to your list. If you don’t manage to do everything, it doesn’t matter - move any incomplete tasks from today on to tomorrow’s list.

3.       Take a Break and have Fun

If you spend too much time in front of the computer, at your desk, or doing whatever it is that your occupation requires, you should take a break. This doesn’t mean you have to take time off work - it just means you should try to make better use of your non-work time to do something fun.

4.       Be Generous

Generosity has a tendency to come back. You can be generous with your smiles, your advice and many other things. Always try to find a way to help others. One day you may be in great need and people you know will be more likely to come to your aid when they know that you would do the same for them.

5.       Accept the things you can’t Change

When something bad happens in our lives, we try to fix them or change them. But sometimes we can’t. Often this leads us to spend hours moping and falling in to depression. If you can make yourself accept the things you cannot change – you will become a much happier person. Acceptance of these situations also allows us to start finding a way to cope much faster.

6.       Break the Chain

If you have a lot of patterns in your life, try breaking them - do something different every day. Let’s say you always order the same meal at your regular restaurant, try something else next time. Not only do you get to broaden your experiences of life, you open up many doors for the future.

7.       Face the Fear

Every day you should do something you don’t want to do or feel uncomfortable doing. This varies in degrees for everyone, but we all have little things we can start out with. Best way to overcome fear is to jump into. Is you are afraid of water; best way is to learn swimming. Living a fearless life gives you a confidence. Instead of building walls around ourselves, we should be tearing them down.

8.       Don’t Procrastinate

This has been a great challenge for every one. The feeling after completing a task you would normally put off is. When you put something off, you are putting yourself into time debt. You have to pay that debt back and almost always you end up having to do that at the most inconvenient time. Your life will become so much more organized if you follow this rule.

Prioritizing the Work

Many a time, we do things that make us busy than effective. The result? Genuinely important things get pushed aside until they turn into crises.  Knowing how to prioritize the work reduces stress. We should do what matters and when it matters.

The first step is to know what your work actually consists of. Make a list of everything you need to do, along with any deadlines you have. Once you know what you need to do, organize it. Start by prioritizing only those things that are deadline driven.

Prioritizing is not easy. But, it actually enhances your performance. It means easier completion and avoids procrastination. In order to move the ball forward you need to start somewhere. There are several ways you can prioritize your tasks. You can try one of these ways. The way you decide to organize is up to you. Everyone works best in their own way.

First thing in the morning, write down everything that needs to be done that day. Once you have listed down, separate the items into urgent vs. non-urgent to determine the top priorities for that day.

Completing certain tasks will offer more benefit than others. We are into financial services. For our kind of business, customer engagement, customer service and customer satisfaction plays a crucial role in our success. Let us follow a rule that customer work comes before internal work. Because customer work not done has bigger ramifications than internal work. 

When creating your list of priorities, be realistic about your bandwidth. Setting unattainable goals will only cause disappointment down the road. The goal should be set in a SMART way – Specific, Measurable, Achievable, Realistic and Time bound. Involve all the stake holders in the goal setting process and make them accountable for the performance. The individual’s priority should be in sync with the team’s priority so that there should be seamless progress across the system.

The most common way to prioritize the work is by due date. When you know when something must be finished, it is easier to find the time to finish it by its due date. If you know you have a task due on Tuesday, then obviously it would rank higher on your list than one due on Friday. If your tasks do not have any concrete due dates, assign them due dates yourself. By giving yourself a time frame to accomplish the work, you will likely be more productive.

Let us prioritize our work.

Effective Work Relationships

The quality of the work relationships within the office is very important to succeed in our business objectives. A positive work environment is required for our physical, mental and emotional health. It helps to improve our performance levels. The better we feel at work, the more likely we will take pride in our job and be loyal towards our place of employment.  Let’s look at some ways to create a positive working environment.

Establish a sense of unity

A strong sense of togetherness can establish a positive atmosphere. It begins with you. Each one should communicate the importance of unity in the office and value the importance of others. We should share the success with the colleagues and learn to own up for the failures. In your official communication, better avoid using “I” when you can use the word “We”. This would strengthen the team spirit, after all what we deliver is only out of collective efforts.

Be a positive person

Present an attitude of positivity and approachability. Show coworkers that you are available and wiling to help them. Walk around with a smile and make eye contact with those you pass through. Be friendly, pleasant and nice. Talk with kindness, encouragement, civility and respect. Ask questions before making assumptions. Be fun to work with. Listen to others with interest and finally don’t complain or gossip.

Trust in each other

Trust is about having faith in those around you and cultivating relationships with them at every opportunity, especially through breakfasts, lunches, dinners, etc. with them. If you have trust in each other, you can share responsibility when times get tough. When a problem occurs, one should jump in together and solve it and THEN figure out why it happened? That is the true test of the effectiveness of your work relationships.

A focus on process

Everyone likes to be successful. If you show others you care about them, especially through creating processes that support them, you will earn their trust. If you involve them in this process, you get new perspectives, new approaches and even better ways to collaborate.

Pride and caring in what you do

The most effective work relationships are also built on a foundation of shared pride in the work being completed. If you’re not proud of it, why do it? Put your “collective stamp” on everything you do together and your relationships will grow.

Be social

Interact with your colleagues in a non-working way. Look for opportunities to meet. Celebrate birthdays and other special events. Cultivate working friendships. There are so many things that you can do to connect with others while at work. Here are some signs of what a positive work environment looks like:

·         You are doing a job that you enjoy.

·         Your ideas are valued.

·         Your creativity is encouraged.

·         You feel appreciated.

·         The job matches your skill set.

·         You have work friends that you can talk to.

·         Your manager is approachable.

·         There is room for you to grow.

·         You are recognized when you do a good work.

·         You feel like a part of the team.

·         You are respected.

·         You are happy while at work.

Let us create an atmosphere of togetherness and succeed in our endeavours.

Time Management

A wise man said that once you spent your money you can always make more, but once you spent your time it’s gone forever. We all complain that we are not able to manage our time better.  The first thing we need to understand is that we can’t manage time.  Time is like a flow of energy, all we can do is manage ourselves better to harness that energy. Below are some tips on how to manage ourselves better to achieve more.

1.       Set personally motivating goals

Most of us know what we need to do to be successful but we procrastinate doing them for one reason or another.  Because we are not focused on a motivating goal, we will put off an important task for the next shiny item that looks interesting.  Having written, motivating, goals will help us align our task to our goals.

2.       Don’t finish today until you plan tomorrow

If you wait for the morning to figure out what you need to do, you are losing valuable time.  If at the end of each day you review your goals and write out your action items making sure they are moving you closer to your goals, you will find that you will increase your productivity by 15-20%.

3.       Eat a Frog for Breakfast EVERY day

This comes from Brian Tracey’s book of the same name.  The idea is simple.  Each day pick the biggest task you need to do and schedule to do it first.  If not you will push it off and you find that it keeps moving to the next day on your to do list.  Once accomplished your day will be filled with items you enjoy doing and you will feel more fulfilled and motivated at the end of the day.

4.       Don’t Major in Minor things

If you focus on accomplishing the major items on your list you will find you will have room for the smaller items.  But, if you fill your day with the smaller items there will never be room for the big major items.

5.       Create a default Diary / Stick to it

Most of us don’t get important tasks done because we don’t schedule a specific time to do them.  Create a calendar where you schedule default times to work on the major activities you need to get done on a weekly basis.

6.       Invest time don’t spend it

Our biggest time waster is spending our time on doing busy work instead of important work.  We invest our time, by working on items that will affect our profits.

7.       Have agendas for all meetings

In addition to the agenda, we should also have a goal to be achieved out of the meeting.  Focus agenda items based on the goals of the meeting.  Don’t mix strategic meetings with tactical meetings.  When we do, we don’t accomplish much.

8.       Have conference calls to save time

Team communication is important but sometimes it’s inefficient to call in team members from the field to have a meeting.  Instead, conference in team members for tactical meetings.  This will help you keep your team focused and aligned to the overall goals of the company.

9.       Learn to delegate to your team

The busy work you spend time on needs to be delegated to junior employees so that you can invest your time on more profitable tasks.

Time is more than money

Self Management

We are responsible for everything that happens in our lives. Learn to accept total responsibility for ourselves. We all can learn to be more self-governing through disciplining ourselves. If we do not manage ourselves, then we are letting others to control our lives.

There is a saying; Any business, where everyone lives and works by self managing, the business is destined for greatness Here is a list of things that can help us in self management which in turn would lead us to the path of success:

1.       Look at every new opportunity as an exciting and new-life experience.

2.       Be a professional who exhibits self-confidence and self-assurance in your potential to complete any task.

3.       Agree with yourself in advance that you will have a good attitude towards the upcoming task.

4.       Frequently ask, is what I am doing right now moving me towards my goals?

5.       Do it right the first time and you will not have to take time later to fix it.

6.       Accept responsibility for your successes and failures. Do not look for a scapegoat.

7.       Do not view things you do as a "job." View all activities as a challenge.

8.       Use your subconscious mind by telling it to do what you want. Instead of telling yourself, "I can't do that very well," say, "I can do this very well.

9.       Give yourself points for completing tasks on your "to-do" list in priority order. When you reach 10 points, reward yourself.

10.   Practice your personal beliefs.

11.   Make a commitment to show someone a specific accomplishment on a certain date. The added urgency will help you feel motivated.

12.   Practice self-determination, wanting to do it for yourself.

13.   Believe that you can be what you want to be.

14.   Never criticize yourself as having a weakness. There is no such thing. You are only talking about a present undeveloped skill. You do not have any weakness, only untapped potential.

15.   Be pleasant all the time-no matter what the situation is.

16.   Challenge yourself to do things differently than you have done in the past. It provides new ideas and keeps you interested.

17.   Talk to yourself. A self-talk using positive affirmation is something that is common among all great achievers. They convince themselves that they can accomplish their goals.

18.   Create your own "motivation board" by putting up notes of things you need to do on a bulletin board or special wall space. It is an easily visible way to see what you need to work on. Also keep your goals listed and pictured on your board.

19.   Stay interested in what you are doing. Keep looking for what is interesting in your work.

20.   Establish personal incentives and rewards to help maintain your own high enthusiasm and performance level.

Let us learn to manage ourselves.