Recently we attended a adviser forum where bank based advisers lamented that while they get a high level of referrals from in house mortgage lenders, the conversion rate was incredibly low, in fact less than 20%.
On further questioning, we found that the way the referral was positioned was flawed as was the timing of the referral. The referral was positioned with the client at the later stages just before loan settlement or the early stages post loan settlement. In referring the pitch was along the lines of: "do you have insurance?"...."our guy can probably do it cheaper".
With no room to add the value of strategy, structure, complete solution plus the positioning of the service as purely transactional the respect shown by both the referrer and the client were set low.
In contrast a study of Bancassurance overseas and in particular Canada, by RGA, reported that referral rates from bank lenders to the insurance network was of the order of 70% and a conversion rate of 90%.
How did they achieve such great results?
It's all about timing and positioning.
The referral was positioned at a very critical stage, in fact when the client was the most relieved, happy, satisfied : in the 7 seconds immediately after the client had just been told that the loan had been approved.
Secondly the referral was positioned quite distinctly. So in that 7 seconds after the client had heard the loan had been approved : " How are you feeling", "It's terrific isn't it, I'm really happy for you" " I want to make sure you always feel this way about your loan and about what you loan is providing you" " I want to make sure you avoid suffering any financial stress" " I'm referring you to our protection specialist, to make sure you can always afford to live in your home/run your business from this property".
Timing and positive language. 70% referral rates, 90% conversion.
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