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Basic Advertising Guidelines for
Direct Marketing of Term Life Insurance

By John L. Cimino

While certain forms of insurance sold in the United States have developed into commodity products, such as automobile and homeowners insurance, life insurance has remained a difficult product to sell through direct methods of distribution.

Whereas the necessity of many property and casualty insurance products has been slowly woven into the fabric of American business and culture, life insurance persists in being an insurance product that is seriously undersold.

In fact, 61% of all adults in the United States have no individual life insurance whatsoever!* Individual, in this case, means non-group. Most Americans have some form of low face value life insurance where they work. But even this fact is being diminished by the downsizing of employee benefit insurance programs, and the rapid growth of small businesses which provide no insurance to their employees at all.

So what’s going on here? Why are so many people either uninsured or underinsured in terms of their life insurance protection? The answer is actually very clear: No one sells it to them. And when insurance agents do make a sale of life insurance, 74% of the time they recommend higher costing permanent life insurance, or complicated, costly “Universal Life” plans, instead of simplified lower costing term life insurance policies.

Quite understandably, this is due to the fact that life insurance agents work for commissions… and commissions are much higher for ordinary life as compared to term.

It is against this backdrop that we see the emergence over the past 20 years of direct marketed term life insurance through various direct marketing media including direct mail, print, television and radio, and, most recently, alternative media including the Internet.

How to Position the Product

In marketing life insurance direct to consumers, product positioning is crucial. With no intermediary to assist in the explanation of benefits or features of the product and to facilitate its sale, the advertising must clearly and emphatically demonstrate the need for life insurance. Therein lies the problem. It has long been a tenet of advertising, especially general advertising, that the most powerful way to sell any product or service is through a dramatic or emphatic demonstration of what the product or service does…and who benefits from its use or purchase.

So the real question is: how do you demonstrate what life insurance is or what it does. It’s not a tangible product. You can’t photograph it or show its inner workings. And most of the ways you can think of to explain what the consequences will be to a family who loses its principal source of income due to the premature and unexpected death of a family member, are often labeled "scare tactics" by overzealous insurance commissioners.

The challenge is to find another way to effectively demonstrate the necessity of having an adequate amount of life insurance.

One of the most powerful, successful ways I have ever found to position life insurance is a concept called—"The Final Paycheck." In this approach, which has been done in several direct mail packages, the focus is on an actual check or cheque, which serves as a graphical depiction of what life insurance is really all about.

While showing a check through the window of an outside sales envelope is a fairly obvious and decidedly overused tactic for getting someone to open a direct mail package…it works!

In the direct mail package shown here,we used an oddly placed window which extended all the way to the left edge of the #9 outside envelope to reveal a small portion of the check.
Above the name and address, in a very small, ornamental type font, you can see the copy: “Pay to the Beneficiary of:”

This package was mailed to select credit card customers of MBNA America Bank…whose affinity group credit card customers tend to be upscale with above average incomes and excellent credit ratings. Package design needed to be attractive, hard-hitting, yet inexpensive—a difficult balance to strike.

As previously mentioned, showing a check through the window of an envelope is not exactly a novel device used by direct mail marketers. Banks and mortgage companies do it frequently, as well as car dealers and telecommunications carriers trying to get customers to switch. Quite understandably, it’s the greed factor which makes these packages work, and believe me, they work or successful marketers wouldn’t keep on mailing them.

The difference in this instance, however, is that we’re using the check as a representation of the product, rather than merely a financial incentive to buy.

In the U.S., insurance companies are not permitted to use checks or depictions of currency to sell health insurance, but no such regulation exists for the sale of life insurance.

Once inside the package, you see the entire check revealed at the top of an 8 1/2" x 14" sales letter. The check is the addressing vehicle, containing the person’s name and address. The check is made out for $100,000.00 and has the word SAMPLE printed on it in a large outline type font. At the upper left is the name of the insurance company.

The headline of the letter reads: “This is no ordinary paycheck. Think of it as your final paycheck, the one that will take care of your family after you’re gone.”

This makes for a very strong presentation: you’ve got the visual power of the check juxtaposed with the thoughtful, personal tone of the headline.

Essentially, we’ve found a way to demonstrate the product’s necessity and major benefit. We’ve found a way to get the prospect to start thinking about his or her own personal financial situation, and we’ve done it in a way that’s intrusive…but not offensive!

Copy goes on to position the product as affordable and easy to get. It also mentions that the coverage is yours to keep…even if you lose your job…you’ll still have this coverage. The bottom of the letter urges the reader to complete and mail the application, fax it or call an Insurance Specialist.

The application for this term life insurance offer is also an 8 1/2" x 14" form which contains a filled-in section for the cardmember, as well as an application or the spouse.

The headline above the actual application reads: “Take this step toward better protection for your family and loved ones.”

While this is a large form, it has been designed in such a way that it is friendly and easy to follow. The areas where information needs to be provided are all white, and the entire form is attractive, avoiding the all too common mistake of insurance applications which have a menacing, confusing appearance.

The customer and spouse section asks for basic personal information and offers a choice of either $100,000 or $50,000. A billing option is provided for credit card or direct bill on a quarterly, semiannual or annual basis. (Despite the fact that this mailing was made to credit card customers, many people do not want to pay interest on top of their premiums.)

The health information section contains three simple Yes or No questions, and there is authorization copy above the signature.

To keep the application from looking cluttered, the Medical Information Bureau disclosure notice was printed on a separate sheet and included in the mailing.

Poor application design and confusing copy are major impediments to response in many direct marketing life insurance programs.

Remember, there is no insurance agent or other intermediary to explain how the application process works.

If you make it difficult for individuals to apply, chances are they won’t!

How many times have you seen a direct mail term life insurance solicitation containing a four-color brochure printed on an expensive, glossy coated stock with photos of happy, smiling families? What these brochures have to do with selling life insurance is beyond me.

In this term life insurance package, we took a basic sheet of paper sized 8 1/2" x 14", the same size as the letter and application, and turned it into an attractive, cost-effective brochure.

We called it an Outline of Coverage. Actually, it wasn’t an official Outline of Coverage. It was really just a brochure which contained the major features and benefits of the term life product, including the rates for this protection.

By making this piece look more official than promotional, we were able to establish more credibility for the offer.

Life insurance is serious business. The portrayal of happy, smiling faces does nothing to advance this concept or to help sell it.

Additional copy throughout this piece explains the advantages of term life insurance, and points out how convenient and easy it is to get this protection.

By utilizing this simple format, we were able to meet the client’s objective of mailing a high impact, yet inexpensive package.

The overwhelming success of this concept over many years and many different package design variations proves the theory that financial services direct mail does not have to be high cost to be highly effective.

One additional component completed this package. It was a Lift Note which contained a depiction of U.S. currency to reinforce the concept of the final paycheck.

The cover contained a headline which read: “Fiscal Fitness.” The subhead below read: “Don’t hesitate. Make sure your family’s financial future is in great shape!”

Inside the lift note, copy posed the question: “Have you given your family a false sense of security?”

The copy goes on to pose the question of what would happen to your employer-provided benefits if you no longer had your job. The call to action at the bottom, once again, instructs the reader to complete the enclosed application and return it in the postage-paid envelope provided. Or fax it.

The major reason this concept works so well across so many different types of term life insurance offer is its credibility. It clearly demonstrates the nature and the need for term life insurance, and the creative positioning sticks relentlessly to its central theme.

This concept has been developed by myself and other creative practitioners with great success on many term life insurance direct maketing programs, including Sponsored or Affinity programs, Broad Market programs, and Cross-Sell insurance programs to Policyowners and Policyholders who have other insurance products.

It’s clear. It’s simple. It gets across the right message.

The bottom line in insurance direct marketing advertising is really quite simple: If it doesn’t sell, it isn’t creative!

*LIMRA International, Profiles in Coverage, 1993 pp. 12, 24.

© 1999, John L Cimino

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