Can Final Expense Leads Be A Solution For The Mortgage Protection Lead Shortage?

Finding mortgage protection leads is critical component for any life insurance agent.

With the seemingly endless supply of new homeowners in America, you would think there would be endless opportunities to connect with those interested in protecting their households from tragedy. 

At least, that’s how it normally is.

The Mortgage Protection Landscape Today

During the year after the initial Covid outbreak, mortgage rates went down to their lowest level in decades.

At the same time millions of Millennials who had delayed purchasing a home suddenly felt pressured to get away from roommates – especially with the increase in work-from-home initiatives, people could work in high-rent cities and own a place in a suburbs.

This created a perfect storm where there was an absolute deluge of people refinancing AND buying new homes. With tons of new mortgages – generating mortgage protection leads was easy. 

But now, with interest rates staying stubbornly at around 7% for nearly a year, the refinance market has disappeared, and new purchases have been severely curtailed.

Even worse (for the mortgage market) many sellers can sell their homes for far more than they paid for them, and just roll that money into a new home without needing a loan at all! Less mortgages = less mortgage protection leads.

The result?

With a drop of nearly 89% in refinance closings, and 50% drop in new purchase closings, there is much more fierce competition among mortgage protection agents to close a new deal.

And more competition means costs have soared for new leads, with some raising to over $80 a lead – in other words, not ideal. 

Final Expense As An Alternative When Things Get Slow

Often referred to as “burial” or “funeral” insurance, final expense is a type of coverage pertaining to funeral arrangements and other incurred expenses caused by one’s death. 

This sort of insurance is especially great for those that cannot afford whole life insurance or cannot qualify due to a medical issue, but still want to protect their spouse and children from unforeseen costs.

For these individuals, final expense is an alternative due to its lower costs and fewer upfront qualifications. 

One benefit to final expense insurance is that it’s demand and supply is not correlated to the economic cycle.

While a poor economic cycle may see a rise in final expense leads, the need remains consistent throughout the year. 

In the aftermath of the 2008 Global Financial Crisis and real estate crash, new home purchases remained depressed for almost a decade. Many mortgage protection companies pivoted to final expense, because the conversation is very similar, even if the targeting is very different.

In both cases, the product being sold is an alternative to full life insurance. Unlike mortgage protection, the final expense insurance prospect universe is huge, with nearly limitless lead production potential.

However, while final expense may have a large prospect potential, agents should still remain purposeful in the households they target to keep costs low. 

Direct Mail for Final Expense Leads

The senior population remains partial to direct mail, and subsequently final expense. The Baby Boomer generation is especially responsive to direct mail, as 71% say that mail feels more personal.

In addition, Baby Boomers trust direct mail more than other marketing mediums, including social media and email. This means that marketing mailers can build up your business’ credibility with its desired audience through direct mail. 

The beauty of the business return envelope is that every response you receive is a strong indicator that:

1.) A real person saw your ad

2.) They live at this address

3.) This individual is highly interested in your service. 

And crucially, the business return envelopes come from individuals who took more time and effort to signal their interest to you, in comparison to just filling out an online form. (Although QR codes are handy for those that want to reply immediately).

Those that took the time to read and respond through their mail have a higher chance at becoming a high-quality customer because they took the extra time and patience to personally respond to you. 

DK Solutions for Final Expense Leads

Many companies promise “data targeting” – but generally only use surface level characteristics such as age and income. Or worse, targeting at the zip code or neighborhood level instead of by individual households.

This misguided strategy often leads to large, bulky campaigns that lack the efficiency for a high ROI. Your marketing needs a specific targeting strategy that understands and models for your ideal customer base. 

At DK Solutions, our proprietary TargetList strategy is just that – a data modeling methodology created in mind for businesses.

Forget the obvious stuff your competitors are doing, with TargetList you can find your ideal customers by building a unique profile based upon thousands of characteristics and spending habits of your highest paying customers. 

Furthermore, DK Solutions has perfected a tailor-made final expense model that targets for the obvious stuff (like age and income), but further narrows down who to target based on dozens of other behavioral patterns we have identified.

And we have been refining this methodology for over eight years with new inputs from hundreds of thousands of responders.

Our final expense model is also based on BUYERS not just respondents, so the people who respond to DK leads are much more likely to actually PURCHASE final expense, as opposed to just being more likely to fill out a form.

Our model has generated hundreds of thousands of leads for our clients. And our data forecasting on a county-by-county level helps us predict how many prospects reside within a current area.

And because everything we do is customized for our clients, we will not force you into a design or style of lead. If you like a certain style or verbiage – we will work with you to create your perfect lead.

Finally, because our methodology necessarily cuts out 80-90% of possible addresses in a given zip code and only focuses on specific, individual households with likely customers, our ability to target is limited to one partner per region.

So agency or agent who signs up to get leads in a given county is the ONLY partner we will have in that county. 100% of our lead generation is customized and exclusive to our partners and we do not share or resell leads – ever.

This strategy sets us apart from our competitors – a targeted methodology that cuts out unnecessary costs, while helping agents exceed sales goals, and is exclusive to one partner in a given area. 

It’s not magic or a secret sauce, it is a methodology that has proven time and time again how to model and market to ideal customers. 

Forget what you previously knew about direct mail or final expense leads.

Our DK Solutions TargetList identifies our client’s primary audience based on historical data to better market to their future customers.