You are reading a page from Life Insurance as a Life Work, by Hugh Hart
(1926)
Part of the American Term Life Insurance History Project
Term Life Insurance
CHAPTER III
PITFALLS
I preach to you then my countrymen that our
country calls not for a life of ease, but for a life of
strenuous endeavor. ... If we stand idly by; if we
seek merely swollen slothful ease and ignoble peace,
if we shrink from the hard contests where men must
win at hazard of their lives and at the risk of all they
hold dear, then the bolder and stronger peoples will
pass us by and win for themselves the domination of
the world. Let us therefore boldly face the life of
strife, resolute to do our duty well and manfully.—
THEODORE ROOSEVELT.
We want you now to consider some of the
pitfalls that are to be encountered in the
business or profession of selling life insur-
ance. It may seem strange that we should
suggest an examination of the pitfalls first.
"We do so because it is just as much our de-
sire to try to keep men who would not be
adapted to the life underwriting business
37
LIFE INSURANCE AS A LIFE WORK
from entering it, as it is to influence those
who belong in the business to enter it.
At the outset let us call attention to the
fact that any business that does not present
difficulties to overcome is not worthy to be
chosen for a life work by a man of spirit
and character. In his fascinating autobi-
ography, Booker T. Washington discusses
the advantages of belonging to an unpopu-
lar race. He lays down the commendable
philosophy that a man who is a member of
an unpopular race has difficulties to over-
come that are not incident to the life of a
man who belongs to a popular race, and,
therefore, he has opportunities for develop-
ing his character that give him a real advan-
tage over the man whose race presents no
such obstacles.
Pitfalls are, in a sense, the traps that are
set by fate to catch the weak and unwary.
No strong man need fear pitfalls. They
add zest to life for such a man. The keeper
of a tavern in a small village has very few
pitfalls in his work, but the drowsy life of
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PITFALLS
such an uneventful occupation would hardly
appeal to the imagination of a man of am-
bition.
The pitfalls which we here cite are only a
few of the outstanding difficulties that the
life underwriter must face.
(1) NO DEFINITE INCOME
In the profession of selling life insurance,
you will have no definite income. You will
probably operate on a commission basis ex-
clusively. The salary on which you may
have become accustomed to rely will no
longer come to you. You become your own
paymaster. If you make sales, you will be
paid; if you do not, you will go without pay.
Days or even weeks may go by, in the early
stages of your development in this busi-
ness, during which you will not have made a
single sale.
"I am afraid to take a chance," say many
men who find themselves facing a business
that does not pay a regular stated salary.
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LIFE INSURANCE AS A LIFE WORK
There is no surer evidence that such a man
has fallen into a rut and that the rut is serv-
ing as a grave for his hopes and ambitions.
Samuel Miles Hastings, President of the
Dayton Scale Company, a firm that does a
world-wide business, said in a recent issue
of the American Magazine: "Presently
the men who sent me to Europe offered me
a position as confidential assistant to one of
the executives. I was to receive a salary of
three thousand dollars a year and a small
block of stock. 'You'll have to give me a
little time to think it over,' I told them. I
had a friend who held a salaried position
with a. big company on Michigan Avenue.
I explained the offer to him and asked what
he thought of it. 'That's very decent,' he
said. 'It's as good a salary as you could
probably get anywhere and the stock is ex-
tra.' It was a good offer. Three thousand
dollars meant considerably more in those
days than it does now. 'Would you accept
such an offer,' I asked my friend, 'if you
were twenty years younger and knew what
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PITFALLS
you know now about business? Or would
you feel it wiser to keep yourself free of a
salary, and see what you could do on your
own? That's the problem I'm trying to
figure out.' 'Hastings,' he said earnestly,
'if I were your age and had my business
life to live over again, I would go out and
peddle shoe strings on the street comer, if
I had to, in order to be on my own, before I
would tie myself up for life to a salary.
Now I'm sure that you have ability—it's
worth while to try something and see. If
you find you can't go it alone successfully,
you can turn in and get a job any time.' "
Mr. Hastings took his friend's advice, and
accepted a place with the same firm on a
strictly commission basis.
Continuing, Mr. Hastings says: "In the
first two years I made a total of fifteen thou-
sand dollars. Compare that with the three
thousand a year that had been offered me
as a confidential salaried worker! I think
the willingness to take a chance, to seize a
likely opportunity that is not a sure thing, is
41
LIFE INSURANCE AS A LIFE WORK
one of the marks of men who accomplish
most in the world."
Andrew Carnegie says that when he was a
young man a great railroad magnate offered
him a salary of $50,000 a year to become the
manager of a large railway system. The
canny Scot turned it down because it was a
salary proposition. He said he did not feel
that he could go as far in life on a salary as
he could by working for himself. His later
career fully justified his judgment.
We can point, of course, to many out-
standing figures in the business world who
have attained success while working for a
salary. A study of the Federal Income
Tax returns for a single year would doubt-
less give us the names of thousands of men
who, as the executive heads of industrial
corporations, receive tremendous salaries as
compensation for carrying heavy responsi-
bilities. It is not possible to say, therefore,
that in the individual case a man stands a
better chance of making a success if he gives
up a salaried position and depends for his
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PITFALLS
income on the direct results of his own la-
bors. It is possible to say, however, that
by depending on the direct rewards of his
work, in the form of commissions for ex-
ample, rather than on indirect rewards, in
the form of salary, he eliminates some of
the barriers which, in the individual case,
sometimes block the road to financial suc-
cess.
A man who takes a salaried position in a
company may be doing good work and know
he is doing good work but may have to wait
until the man ahead is promoted before he
stands a chance of advancement. He may
be putting a great deal of time and thought
into his work but this fact may not be recog-
nized by his superior. He may advance
rapidly for a few years and then find that
he has reached the salary limit set by the
company for the type of work in which he
is engaged. It is unnecessary to state that
none of these obstacles can stand in the way
of the man who is working for himself.
You may say, "I would not be afraid to
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LIFE INSURANCE AS A LIFE WORK
take a chance if I had only myself to con-
sider, but I have responsibilities to bear that
prevent me from taking a chance." It is
true that there are men whose situations are
such as to make it absolutely necessary that
they be most conservative in regard to mak-
ing a change in their business status from a
salaried to a non-salaried line of work. At
the same time, it is equally true that no man
has ever found conditions ideal for the at-
tainment of any worthy end.
If your responsibilities are such as to
make it impossible for you to take advan-
tage of your opportunities, think how much
more heavily those responsibilities will
weigh you down in the future, for responsi-
bilities tend to become greater rather than
smaller from year to year. Look back over
your own life and consider what your re-
sponsibilities were five to ten years ago, and
compare them with your present responsi-
bilities. If you have found that they have
grown in past years, what have you to look
forward to in the future but a correspond-
44'
PITFALLS
ing increase in your responsibilities(? You
do not solve the problem of your increased
responsibilities by remaining in a line of ef-
fort in which you cannot attain the best re-
sults. That problem is solved in one way
only; namely, by using the ability you pos-
sess to take advantage of your increased op-
portunities.
To the man who has faith in himself,
work on a commission basis is not a pitfall.
To him it is, on the contrary, a challenge
and an opportunity.
(2) LACK OF DIRECT SUPERVISION
In the profession of life underwriting you
are your own boss. Many men are so con-
stituted that they cannot work for them-
selves. If this were not true, factories
would not have to employ high-salaried
foremen and superintendents, other organi-
zations would not require costly office mana-
gers and supervisors, and there would be no
such instrument as the time clock. It has
45
LIFE INSURANCE AS A LIFE WORK
been stated that thirty-seven per cent. of the
failures in the field of life insurance sales-
manship are directly traceable to lack of
industry. This is practically equivalent to
saying that thirty-seven per cent. of those
who fail as life insurance salesmen are men
"who cannot work without a boss.
Can you work for yourself as well as you
can work for another man^ Are you
equipped with a self-starter that will cause
you to start out in the morning with enough
momentum to keep on going, even in the
face of disheartening setbacks, until a com-
plete day's effort has been expended, and
then repeat that performance day in and
day out, with no intervening personality to
prod you on? Can you turn down the
temptation to indulge in ease and play, to
gossip and visit, when your conscience tells
you that you ought to be out after business^
Can you keep on working just as hard when
the weather is hot, when the trout are biting,
when the ball game is on1? Have you
learned the great fact that time is the most
46
PITFALLS
important business asset you have? Do
you know how to systematize your efforts,
to conserve your time so that every minute
will count, or do you have to depend on
someone to do your planning for you and
to lend you moral support? Do you have
to pay somebody to make you do your duty?
Figure it as you may, if you must have a
boss to keep you going, you are paying that
boss for your supervision out of your own
pocket, no matter how well that fact may be
camouflaged. It is a dangerous thing for
some men to work for themselves. Liberty,
that most prized possession of Americans,
lures many to destruction. Independence
is a heritage that some cannot afford to pos-
sess. In this privilege of working for your-
self may lurk an insidious danger if you are
not so constituted that you are master of
yourself. Yet, to a strong man, to a man
whose sense of duty is the ruling passion of
his life, to a man who does not need to be
goaded to continued effort by the lashes of
a taskmaster, the freedom that characterizes
47
LIFE INSURANCE AS A LIFE WORK
the business of life insurance is not a pitfall
but a priceless advantage.
(3) DISCOURAGEMENT
Discouragement is another pitfall. The
same authority who estimates that thirty-
seven per cent. of the men who fail at selling
life insurance fall hy the wayside because of
lack of industry, likewise estimates that an-
other thirty-seven per cent. of the failures
are shipwrecked on the rock of discourage-
ment. Mental attitude is an important fac-
tor in any vocation, but particularly so in
the life insurance business.
Selling life insurance may be called a
process of benevolent domination. The
salesman dominates the person to whom
he sells. It is not a domination by imperi-
ousness, or accomplished by strong-arm
methods. The domination is subtle, but
none the less powerful. It is brought about
by the exercise of the powers of reason, of
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PITFALLS
good sense, of tact, of charm, of sincerity,
all tempered with the strong desire of the
agent to be of service to the client. If the
life insurance salesman does not possess the
spirit of confidence, if he be obsessed by
fear, if his will be weakened by a loss of
faith in his ability to put across his idea—
in other words, if discouragement tinctures
his mental attitude—then he is a wounded
warrior with a broken spirit and unfitted
successfully to carry on the fight.
You must make up your mind before you
get into this business that you can be turned
down times without number and still retain
the mental resilience and the intellectual
fervor that conduce to continued freshness
of vision and a "faith unfeigned." You
must be able to see the promises made to
you by clients broken. You must be able to
face with equanimity the fact that business
on which you had counted may be declined,
for it is estimated that one out of every nine
who apply for life insurance is turned down
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LIFE INSURANCE AS A LIFE WORK
because of physical or other impairments.
Withstanding this strain on courage is no
task for the weakling. You must retain a
clarity of mental perspective, you must have
a temperament of optimism and, above all,
faith in yourself, your purposes, and the
service that you are trying to perform.
Without these supports, you are liable at
any time to be .inundated by a flood of dis-
couragement.
But is this not true to a greater or less
degree of every worth-while enterprise of
life? The monarchs of three nations
turned down Columbus before he induced
the Spanish Queen to pawn her jewels for
the ships with which he found a continent.
The biography of almost every man who has
accomplished anything worth while in any
realm of human endeavor is a record of dis-
appointments faced, of defeats endured, of
dark spectres routed, before his final tri-
umphs cast into forgetfulness the memory
of those discouragements.
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PITFALLS
(4) HAED WORK
Selling life insurance is exceedingly hard
work. Somebody said it was the best paid
hard work in the world, and the poorest
paid easy work. The man who has not a
hardy constitution, a strong nervous sys-
tem, and good digestion had better stay out
of this business. First, there is the train-
ing that is required. Formerly, all a pro-
spective agent had to do to enter the field of
life underwriting was to get a rate book, a
few application blanks, perhaps a few leaf-
lets, and, after a short talk with his mana-
ger, he was considered as "trained" for the
business.
In a day of specialization, however, this
preparation is no longer sufficient. A life
underwriter does not merely sell policies;
he renders a service by meeting the insur-
ance needs of his clients. The physician
must first know how to diagnose physical
ailments, and then he must know what treat-
51
LIFE INSURANCE AS A LIFE WORK
ment to apply in order to relieve his patient's
impairments. Likewise the life under-
writer must be acquainted with the uses and
functions of life insurance and with the
various human needs that it serves. In the
light of this special knowledge, he must ana-
lyze his client's situation from the life in-
surance expert's point of view, then show
him what his life insurance requirements
are, and supply policies that exactly meet
those requirements. The day of the unin-
formed life insurance salesman is rapidly
passing; and to obtain and retain the in-
formation necessary for success in selling
life insurance in this modern day, requires
intensive and continuous study. To render
up-to-date professional service, the life un-
derwriter must have a certain amount of
knowledge concerning the following sub-
jects :
1. The technic of salesmanship.
2. Life insurance principles and func-
tions.
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PITFALLS
3. His own company and "the policies
which it issues; that is, the advan-
tages which these policies pre-
sent.
4. The advantages and disadvantages
of the contracts offered by other
companies with which he is likely
to be brought into competition.
5. Human nature and practical psy-
chology.
6. Elements of taxation and its effect
on life insurance transactions.
7. How to analyze life insurance needs
and prescribe a program to meet
those needs.
8. Elementary facts about trusts and
their relation to life insurance.
Not only should you become conversant
with these subjects at the outset of your life
insurance career, but you must keep up with
the rapid developments that are taking
place in the life insurance business. This
may be done by attending agency meetings,
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LIFE INSURANCE AS A LIFE WORK
reading insurance magazines, studying
books on various phases of the business,
consulting with successful life insurance
men, and, above all, by practising your art
on prospects, thereby receiving the instruc-
tion of the greatest of all teachers—experi-
ence.
But the work of training may hardly be
said to compare with that of actual .selling.
You must first select your prospects. It
seems strange that this should be a difficult
task, but considerable time and thought are
required to keep a list constantly in hand of
select prospects whom you are to try to in-
terest in life insurance. Each name that
goes on your list should be carefully chosen,
diligent inquiry should be made concerning
each one, with special reference to his health,
his earnings, the amount of money he owes,
his family and other responsibilities, and his
business connections. Whenever possible,
it is well to know these facts in advance of
seeing the prospect.
Then, as the next step in the selling
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PITFALLS
process, you must call upon from three to
ten prospects daily, breaking down the bar-
riers to get to them, getting by the secretary
in the outer office, overcoming the objection
that the prospect hasn't time to see you, or
other similar excuses. Even if you have no
difficulty in obtaining the interview, or after
you have actually entered the prospect's
office, you must present your proposal in a
logical and attractive manner and must
bring the prospect to your point of view, all
of which is hard, intensive work. Deliver-
ing policies, keeping business records, han-
dling correspondence, making collections,
attending agency meetings and underwrit-
ers' dinners, all these are but a part of the
life underwriter's daily work. Not only is
he kept busy by these routine tasks, but he
must constantly be planning sales cam-
paigns, devising new sales suggestions, and
building good-will.
If you are a weakling, if you are lazy, if
you cannot stand up under a strain, if you
do not find pleasure in dealing with your
55
LIFE INSURANCE AS A LIFE WORK
fellow men, then the pitfall of hard work in
this vocation would doubtless cause you to
fail. The late John Wanamaker, who for
many years was the most heavily insured
man in America, made the statement that
there are three classes of people: workers,
jerkers, and shirkers. Only those who are
willing to pour their very life's blood as a
sacrifice upon the altar of hard work may
expect to find success in the great profession
of life underwriting.
(5) THE OTHER JOB
"The other job" that is invariably of-
fered the man who starts in the life in-
surance business constitutes one of the most
dangerous of the pitfalls which lie in his
path. Just as you begin to "bump the
bumps" in your new work of selling life
insurance, just as you are in the depths of
doubt as to whether you are going to make
the grade, along comes the tempter with the
"sure thing" to offer you. Perhaps he is
56
PITFALLS
the person who tries to show you that you
have made a mistake in going into the life
insurance business at all, when you should
have gone into the business in which he is
interested. Or, there is the unscrupulous
agent of another life insurance company
who tells you how foolish you were not to
have connected up with his company and
promises to get you an offer, which may
look much better to you (on paper) than the
contract you already have. Ofttimes these
offers are really meritorious and are given
in good faith by those who do have a real
opportunity for you. But, as we have
pointed out in Chapter I, you should not
start in the life insurance business unless
you plan to give your life to this work.
Having once decided to invest your life in
this vocation, therefore, you should not give
it up without a fair trial. Don't forget
there are acres of diamonds at your very
feet in this fine work of insuring lives.
Only by continuity of effort, by dogged
stick-to-it-iveness, can you develop in this
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LIFE INSURANCE AS A LIFE WORK
or, indeed, in any other worth-while under-
taking in life.
(6) FEAE
The last pitfall to which we shall refer is
fear. It is largely a mental hazard, having,
usually, slight substance upon which to rest.
At the same time, it can do you a tremen-
dous amount of harm in the life insurance
business if it is not overcome. Montaigne
in one of his essays says: "The thing in
the world I am most afraid of is fear and
with good reason; that passion alone, in the
trouble of it, exceeding all other accidents."
Montaigne correctly appraised fear, for it
is clear that he regards fear itself as far
more dangerous than the cause which gives
rise to it. Let us try to discover whether,
upon analysis, there is any real place for
fear in the life insurance business.
Why am I afraid?
1. I am afraid to enter the life in-
surance business because I know
nothing about it.
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PITFALLS
Ample means are readily at hand
for gaining the required know-
ledge.
2. I am afraid I have not the qualities
required to make a success of this
business.
Perhaps you may not have. Per-
haps you have those qualities to a
very marked degree. Why not be
enthusiastic about the latter possi-
bility rather than fearful of the
former? Do the successful life
insurance men you know seem to
possess any traits which you do
not have? If so, do you not, like-
wise, have qualities which they
lack? Do you distrust yourself?
How do you expect others to have
faith in you if you do not have
faith in yourself ? Even if you do
not have the necessary qualities
now, are you not willing to work
hard to develop the qualities you
lack? Do you not believe your-
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LIFE INSURANCE AS A LIFE WORK
self capable of growth and im-
provement ?
3. I am afraid I shall receive rebuffs.
Try this experiment. Talk to five
successful life insurance salesmen
about this fear. Ask them how
many rebuffs they receive. Occa-
sionally one, they will tell you,
from some person who knows little
about modern life insurance sell-
ing—very rarely even that, un-
less, of course, the rebuffs are due
to their own improper methods,
and are deservedly brought down
upon their own heads. Go to a
courtroom and listen to the law-
yers as they try a case. Sit by the
executive head of any large busi-
ness through a busy day. You
will discover that they all get their
share of rebuffs as a part of the
day's work, and the life insur-
ance man who conducts himself
properly does not experience any
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PITFALLS
larger percentage of unpleasant
relationships with his fellow men
than any other business or pro-
fessional man who is brought into
daily contact with people. Yet
the great majority of your con-
tacts will be exceedingly pleasant.
Instead of being afraid of the
occasional rebuff by a prospect,
when any discourtesy will reflect
on him and not on you, why not
find encouragement and zest in
anticipation of the immeasurably
greater number of friendly inter-
views you will enjoy ?
Are not these three sources of fear all com-
prehensive, the fear that is due to ignorance,
the fear that rests on lack of faith in our-
selves, and the fear that arises from a mis-
taken conception of the nature of the work ?
Are these fears justified by facts? Are
they not conquerable? May they not be
utterly disregarded?
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LIFE INSURANCE AS A LIFE WORK
There are real problems to solve in the
life insurance vocation, enough of them to
absorb your effort, without indulging in
fears that are based largely on the creations
of your imagination.
Have we overdrawn the difficulties of life
insurance underwriting? Perhaps. If so,
we were actuated by a desire to emphasize
the fact that you must run a very hard race
if you gain the prize of success in this great
field of salesmanship. "We want you to con-
sider most carefully the pitfalls now, be-
fore deciding to enter the life underwriting
profession. Your own inner consciousness
should tell you whether you are made of the
sort of timber to face these obstacles. If
the mere thought of them frightens you,
then you had better eliminate this vocation
from your consideration at once and try to
find another calling. If, on the contrary,
the suggestion of these pitfalls arouses your
fighting spirit and makes you eager to test
your will against their rigorous challenge,
then you will do well to read the balance of
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PITFALLS
bis book, for thereby you give evidence of
ossessing "that something" which consti-
utes the "pearl of great price" in every
uccessful life insurance career.
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