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The life insurance industry is characterized with extreme competition. There are tons of competitors and it is extremely difficult to for any one company to differentiate their product offering. Furthermore, the barrier to exit in this industry is very high as an insurance provider must continue to cover their customer for several years. Due to these factors, many insurance companies seek out any potential advantage that they can find. Purchasing life insurance leads are a common way of achieving this advantage. Life insurance leads come from a company that has access to potential clients. They then sell these life insurance leads to the actual insurance agent who can put together a personalized package for the individual. Despite the clear advantages to an agent of buying life insurance leads, this service remains in use by only a few insurance agents. The reason for this is that most agents are still skeptical of the quality of the life insurance leads that are available for purchase. A very real risk exists that the life insurance leads could simply be a general telemarketing list and would lead to a very low conversion rate.
To combat this skepticism, the reputation of a company that sells life insurance leads must be top notch. Unfortunately, this reputation is hard to achieve. Referrals, a technique often used to spread a good reputation, would not work with life insurance leads as no agent would want to share their competitive advantage with other agents. Rather, the key to gaining a good reputation for selling high quality life insurance leads is mostly through time and patience. It will be difficult to spread the word, but it will happen slowly over time. As well, there is a clear benefit to offering incentives for the first few life insurance leads in order to gain a long term client.
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