Advisor finds niche in small business market

By Susan Yellin | January 28 2014 06:44PM

Heather Freed isn’t a particularly religious person but as a financial advisor she holds certain beliefs when it comes to the tenets of buying life and health insurance.For most people, says Freed, insurance is purchased because they realize they have no control over many of life’s happenings – what she calls the God Forbids.

“These are the God Forbids of getting hit by a bus, the God Forbids of getting cancer, the God Forbids of any of those events,” says Freed. “You may battle over buying insurance because you don’t want to keep paying premiums if you don’t make a claim, but you don’t want to get stuck without the coverage.”

And Freed practices what she preaches. A few years ago, she broke her arm and couldn’t work for a couple of weeks. She didn’t worry because as a small business owner she had purchased disability insurance. “I protected myself from the God Forbids – the inability to work and bring in money on a regular basis.”

Freed grew up in Montreal and after a 10-year stint working in the United States moved to Toronto where she sold scientific equipment to the medical research market. The industry went through a series of consolidations and when she was downsized, she decided to make a change.

Consultative sales

“I always sold consultatively,” says Freed. “People would tell me what they were trying to do and I would make recommendations based on that. So I went looking for something I could do on my own, without a boss, that was basically the same kind of sale. I discovered the whole financial services industry, especially the insurance side, is definitely like that.”

She received her insurance license in August 2001, getting her CLU designation before earning her CFP. She has also earned her Certified Health Specialist designation. Now Freed estimates that about 40 per cent of her business is in employee benefits, 35 per cent is in individual life and health insurance, mostly sole-owner businesses, with the remainder in investments.

Freed said she didn’t have to get the designations, since then – as now – there are no requirements to hold them in most of Canada.

But she finds the combination help her look after the needs of her mostly small-business clients. “Their personal and businesses lives overlap a lot more so you need to know more things about business in order to service them well. Selling someone insurance to cover a mortgage is easy relatively speaking; selling them insurance to cover their integrated business and personal lives means you need to keep more things in mind. Those things I learned through the designations.”

She primarily uses the knowledge she gleaned from the CLU courses in her everyday practice where she provides “life planning” – ensuring all aspects of a client’s life, including insurance and investments, are working together so clients don’t outlive their money, and, if they die suddenly, the financial lives of dependents are looked after.

She is also totally in favour of higher standards than currently exist. Despite efforts by the industry and advisor groups to ensure more disclosure is provided to clients, Freed says there are advisors who sell products that are not necessarily in the best interests of the client.

“I think it would be really nice that if the industry is going to make more regulations, instead of messing around about fee-for-service and removing embedded commissions, they made sure that everyone who is licensed to sell products really did know what they were doing – whether that’s a designation process, or a test every once in a while or whatever.”

Freed is also a big believer in networking, currently belonging to five different groups and visits a handful of others occasionally. She sits on at least one committee per group. While some are for educational purposes, others help her sell her products. “I do it as much to have a network of people I can refer to when clients ask me questions as I do to get referrals of people who need my services.”

While some advisors feel that networking is a necessary chore, Freed says many people make the mistake of thinking that by going to a networking meeting they will immediately generate business and are disappointed when they don’t.

Trust-based business

“You get what you put out. There are people who go home right after a meeting and never talk to anybody except for telling people what they do or giving out their business cards. Our business is very trust based. People have to know who you are, what your style is, what you stand for and you have to be consistent. Unless you show an interest in other people, networking isn’t going to do you any good.”

Like many other advisors, she likes to give back to the community and Freed has been an active member of Na’amat, an organization dedicated to the advancement of women and children in Canada and Israel. While not consciously networking for work reasons, she is always amazed at how much business comes her way through the organization because she is a known quantity and keeps her message consistent.

Freed remembers with a mixture of sadness and purpose the first claim cheque she ever delivered – $2,500 for an 18-month-old child. “I hate delivering claim cheques but it’s also the best part of the job – it means you’ve helped somebody out in a really down time in their life and that’s why you sell insurance in the first place.”