In-house referral partnership brings quality referrals

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Brokers need to look beyond realtors when cultivating referral sources, says one broker, who is getting quality referrals from a financial planner.

“I am getting a couple of good quality referrals a month,” says Ian Mackay, a broker with Verico RedPath Financial. “Our average mortgage size is $500,000, and we are dealing with an educated customer from these referrals – and an educated customer is one of our best customers.”

Mackay and RedPath Financial have been working with an in-house financial planner for five years now, and the relationship has not only provided benefits for the brokerage, but better protection for clients in terms of insurance.

“By offering personal insurance instead of creditor insurance, the client can collect immediately and choose how to spend that money,” Mackay told “With creditor insurance, the bank gets the money – and that doesn’t happen right away.”

Mackay cites an example of one married couple, where within a year the wife died of a brain aneurysm.

“With creditor insurance, she could potentially still be in court,” he says. “The individual insurance has the medical done at the start, whereas creditor insurance only does the medical when the claim is made. That can take weeks, months or even longer – and the client usually needs the money right away.”

The presentation of the option for personal insurance is done from the beginning, says Mackay.

“It is a one-pager for the client, ‘if you are interested, in looking at this, here’s what we offer’ sort of thing,” he says. “If the client isn’t interested, we have them sign (the) waiver, stating that we have offered insurance and they have chosen not to go ahead with it.”

Mackay’s life before mortgage brokering was the insurance business, so although he no longer is licensed to do insurance deals, he retains the knowledge and expertise.

“I initially started as an employee benefit consultant with London Life, so it was easy for me to work with these guys in the insurance industry,” he says. “Because if you are going to refer someone – and I refer my clients to them and they to me – you want to work with someone you can trust.”

Mackay suggests to brokers interested in developing an in-house personal insurance product to do the research, to ask around and treat it like any mortgage – to not only find the best deal but the best package for the client.

“I use my guy for my own insurance and financial planning,” he says. “I know the product is good. You have to sit down with a financial planner and see if there are any synergies there. It is like anything we do – if it is good for your client base, then it is good for your business. And at the end of the day, you can say ‘we did the best that we could.’”

  • Paolo Di Petta | on 2013-07-02 8:06:28 AM

    Just an FYI:
    From what I remember from both my agent and broker course, we (at least in Ontario) are not qualified to recommend any insurance product over another, regardless of how common-sensical it may be.

    You best plan of action is to advise them to seek advice from a licensed insurance agent/broker, although referring only one could open you up to some liability/COI issues.

    Just some food for thought.

  • Michael Sussman | on 2013-07-08 11:18:21 AM

    I have been getting referrals for many years now from Insurance Advisors, Financial Planners and Family Law Lawyers. But I do think real estate agents are the best source of referrals. Why? Because you have been referred to someone in the home buying/selling game. 60% of my business comes from Real Estate Agents, and I work very hard to earn every last deal.

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