The Annuity Lead

Lists of annuity buyers/owners

No insurance company releases the names of their annuity owners.  So any list that claims to be annuity owners or buyers is really a list of people who meet a specific profile AND may be more likely to buy annuities.  We tested these lists and found no greater propensity for people on these lists to buy annuities than if you simply purchased a list of people age 60+, homeowners, household incomes $50,000+.

We tested all the lists using the same postcards and got from 1% to 1.25% response rate.  

So we asked Clarica, a demographics firm. to prepare a list of people who had the highest propensity to buy annuities. 

After  we invested the $1,000 for this sample of buyers, we sent these people seminar invitations and we sent them the postcards for an annuity booklet.  We found no greater propensity for these people to be annuity buyers than the basic demographic criteria stated above.

You can do a rigorous search of “annuity buyer” lists but let’s save you the time.  At a cost of $600, we subscribed to the on-line SRDS direct mail list catalog.  This is a listing of every list that you can rent (the catalog can be accessed for free at most MAIN libraries).  We found approximately 11 companies that advertised lists of people who were “annuity buyers.”  In all cases, the list owners was very vague about what that meant.  As best as we could tell from our questions, these annuity buyers were people who met some basic criteria (e.g. were over the age of 55 and had once completed a survey stating that thy were conservative investors) or may have responded to a phone survey asking if they had interest in a list of financial instruments.  These people likely said yes to stocks, bonds, IRAs, annuities and a host of other opportunities (the same company sells the same list as “stock buyers’). 

As good or bad as the methodology of the various companies are who advertise these annuity buyer lists, we found these annuity leads to be no better than a list of people age 60+, homeowners, household incomes $50,000+.

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People who have requested non-specific information

These are people who have completed a survey at the county fair, a mall, on line, etc in which they expressed information in “investments” or “tax savings.”  As you might guess, these people are no likely to be an annuity lead any better than your deaf grandmom, Bessy.

Yet, some companies will sell you such a list with the title “annuity buyers.”

People who have requested specific annuity information

Now, this is starting to get warm.  If the prospect has requested information about annuities, then we have someone we can classify as an interested annuity lead.  Of course, that does not mean they will buy.  It does not mean they will have more then $5,000, but at least they have indicated specific interest in knowing more about annuities.

But you would like to know a little more from the annuity lead vendor how these people came to express interest.  For example, did they see an offer in a newspaper and they called up or sent in a coupon?  This would be a good quality annuity lead as they received a passive offer and they had to take action.  The fact that they had to take action indicates a level of motivation.   

On the other hand, did the annuity prospect get telemarketed and get talked into getting some information on annuities?  Or did they get an email that said “win a Ferrari, click here” and the solicitation turned out to be a solicitation for annuities and the prospect thought by expressing interest they would also get a Ferrari? If the annuity lead is an “incentivized lead,” it is less worthwhile. 
People who have requested an appointment with an annuity agent

There’a an old saying, “investments are sold and not bought.”  The same is true about annuities. People do not ask to buy an annuity.  They end up buying an annuity after a fact finding sessions with a competent professional and the conversation leads to the purchase of an annuity. The prospect did not enter the meeting or the conversation thinking, “I hope I get an opportunity to buy an annuity today.” 

So if any service or list brokers wants to sell you annuity leads that supposed requested an appointment with an agent, don’t be stupid!  While the prospect may have been talked into an appointment and may have said they were “willing” to listen to what a professional had to say, there are no prospect that “have requested” an appointment with an insurance licensee. That would be like requesting an appointment for a colonoscopy (okay, I’m overstating here). 
People who have agreed to an appointment with an annuity agent

Typically, these people have been telemarketed.  They have been talked into an appointment and have expressed a willingness for a meeting.  We know once company that sells these leads for over $100 each and their big guarantee is that they have called the prospect, secured the appointment and that the prospect has at least $5,000 of investment capital.  Woohoo!  You’ve got an elephant there.

Seriously, in such a circumstance, if the prospect is even home when you show up for this appointment, it will be an uphill battle because:

They really don’t know

• what the meeting is about
• Why you are there
• What you do
• What your agenda is and
• They have no agenda

Annuity Leads that made the first move or leads that were called

As mentioned above, ask the annuity lead source for as much detail as possible on how the lead was generated.  If you find they are vague, then pass.  If they explain it in detail, show you the ad or the coupon, and explain the process, then you have a seller who is far more revealing then most.  Our experience is that they rarely clearly tell you how the lead was generated.

Additionally, get very clear if the annuity lead was generated by the prospect in reaction to a passive offer(e.g. an ad in the paper, a post card, an Internet ad) where the annuity prospect had to take initiative and action OR was the prospect telemarketed and talked into the offer or somehow incentivized to say “yes, I am interested in annuities.”

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