Why You Should Stop Asking for Referrals

In my 23 years working with financial and insurance professionals, I've seen advisors ask without hesitation for $300,000-plus commitments from clients, for large single-premium insurance policies or to invest.

But when it came to talking with these clients about someone they know who could benefit from doing the same thing, they couldn't bring themselves to have the conversation.

They were afraid — afraid of being rejected, afraid of appearing disloyal to the clients they were with, or afraid of appearing needy or "salesy."

But introductions from an engaged, happy client are often the best way to grow your business.

There's no cost, it's immediate, and the introduction comes with a built-in testimonial from the client.

They're good for the prospect, who gets access to your expertise.

They're good for you, because the likelihood of doing business with the prospect is much higher than through other connection methods, and — believe it or not — they're good for the client who is making the introduction.

Referral Fear

You have virtually no risk. The idea that someone would take back a check and storm out of your office or throw you out of a home because you ask for a referral is nonsense.

But the clients put their relationships at risk in providing referrals.

If they take that risk and it works out (and it's likely to since you're involved), the clients become a hero to friends and family members.

You actually deprive your clients of the opportunity to be a hero when you don't talk to them about introducing you.

Bad Referral Training

Those fears of yours likely come, in part, from the way you learned to ask for referrals:

"I get paid in two ways…Give me 10 names and phone numbers…"

"You'll never get a bill from me…all I ask is that you refer me to friends and family…"

Or worse:

"If you'd rather have me working on your account than out looking for business, give me names and numbers…"

"We're having a contest at our office, and I just need two more clients…"

Early in their careers, most advisors learn one or more of these and are told to keep doing them.

But they're uncomfortable, and they ignore the fact that, unless you're asking someone who loves you so much that they want to help you (your mom), your need for business is not something they care that much about.

The methods focused on you and how you build your business are not important to most clients.

If this is what your conversations look like, stop asking for referrals.

(You probably have already.)

What you want instead are introductions.

A Better Way

With referrals, clients give you names and phone numbers — usually of people they're not that close to — to shield from you the ones who are closest — and leave it to you to call them.

Introductions are different.

They exercise the client's "influence muscle." The best of them mention someone specific they know and request from the client a suggested way to connect with them.

When there isn't anyone specific, the focus is someone they might want to help:

"Is there someone we could talk about who might not be feeling the same way about his or her situation? You probably won't know what their situation is, because we rarely talk with one another about finances, but if you care about them, we might want to ask them."

"Who comes to mind you'd want to help, if they needed help?"

With the focus on helping someone in their lives, the resistance is reduced.

Who will reject you for wanting to talk about helping their friends and family?

Of course, this approach depends on your having earned the right to have this conversation, but that's the subject of another article.

Make the conversation about the clients and the people they care about, and getting introductions becomes much easier.

Sandy Schussel is a coach and practice development consultant for insurance and financial professionals. He has served as an MDRT Academy trainer, is on the faculty of the InsuranceProShop and is a preferred mentor with InsuranceWebX. He has served as the national sales training director for a broker-dealer and life insurance company. He is the author of two books, The High Diving Board, about overcoming fear and Become A Client Magnet, about attracting and keeping clients. Schussel's scheduling calendar is available here.