How to build your client bank

In the fourth of a six-part series on business protection, Maria Merricks investigates the ideal strategy for attracting new clients.

Once again, businesses are positive about their financial future. Eighty five percent of companies are confident that their profits will increase over the next five years, according to research by Legal & General and the Institute of ­Directors.

However, a £1.1trn business protection gap suggests that company owners are putting these bright futures at risk. In the event of the loss of a key person, 39% of owners would not expect their businesses to survive another 18 months.
Yet many advisers are deterred from advising companies on these matters, for fears that they will not be able to attract enough clients.

The challenge is targeting the right market, says Gerry Warner, protection development manager at Zurich UK Life. “Before stepping outside the box, take a fresh look at your existing client bank, as many of these may be business owners,” he says. “By using the information you have already collected, you will be able to identify likely prospects.”

A simple database search of the following should provide a useful starting point, says Warner:

Employment status: Business and personal finances are closely linked for the self-employed. This means they will need to protect themselves and their family and may well need business protection.

Occupation: Look for existing clients who are directors or partners in a business. Doctors, dentists, solicitors and accountants are quite often partners in their practices too.

Existing plans: Plans such as pensions, executive or group income protection, general or commercial insurance, and mortgages may indicate a client’s involvement with a business and an opportunity to review their business protection needs.

Business loans and existing cover: Many banks will require life cover to be taken out to protect loans. You may be able to secure this for your clients at a lower cost.

However, there will be some advisers new to the corporate market and they will have to build a business client bank from scratch. This will not be a quick process, but according to Clare Harrop, head of specialist protection at Legal & General, sticking to a plan such as the following four-step approach should make it more straightforward.

1: Planning

“It is important to have a clear business plan in place outlining your objectives. This will help you monitor and evaluate your performance, so you can evolve your plan as necessary,” she says.

Some aspects to consider are the strengths and capabilities currently within the adviser firm, its budget and its existing marketing strategy and brand: can it be adapted to include business protection as another offering of advice?
Harrop says the mnemonic SMART will help to set objectives: ‘Include goals which are Specific, Measurable, Achievable, Relevant and with a Timescale.’