How to Overcome Life Insurance Objections During Tax Time
Tax season is one of the best times to talk to prospects about life insurance. Many individuals receive tax refunds, which they often spend on travel, new gadgets, or paying down debt. However, few consider using that extra money to secure their family’s future with life insurance.
Yet, when agents bring up life insurance, they often face common objections. In this post, we’ll break down the top objections and how to overcome them with smart, empathetic responses.
Objection #1: “I Can’t Afford Life Insurance Right Now”
How to Overcome It:
- Leverage Their Tax Refund – Remind them that their tax refund is a lump sum they can use to secure affordable coverage for years to come.
- Break It Down – Many policies are surprisingly affordable. Share statistics showing that a healthy 30-year-old can get a $250,000 term life policy for less than a cup of coffee per day.
- Cost of Waiting – Explain how rates increase as they get older and that securing a policy now will save them money in the long run.
Objection #2: “I Have Life Insurance Through Work”
How to Overcome It:
- Explain the Gaps – Most employer-provided policies only cover 1-2x salary, which is rarely enough to replace income for dependents.
- Portability Issues – If they leave their job, they typically lose coverage. Having an independent policy ensures financial security.
- Customizable Coverage – Personal policies allow them to choose the right coverage amount and add riders (e.g., critical illness, disability).
Objection #3: “I’m Young and Healthy – I Don’t Need It”
How to Overcome It:
- Lock in Lower Rates – The younger and healthier they are, the cheaper their premium will be. Waiting means higher costs.
- Future-Proofing – Accidents and unexpected health issues can arise at any time. Locking in coverage early provides peace of mind.
- Tax Benefits – Life insurance offers tax-advantaged cash value growth for those considering whole or universal life policies.
Objection #4: “I Don’t Trust Insurance Companies”
How to Overcome It:
- Educate on Reputable Providers – Show them ratings from independent agencies like A.M. Best, Moody’s, or Standard & Poor’s to prove reliability.
- Customer Success Stories – Share real-life examples of families who benefited from life insurance payouts.
- Emphasize Control – Help them understand that they control their policy choice, beneficiaries, and coverage amount.
Objection #5: “I Want to Invest My Money Instead”
How to Overcome It:
- Diversification is Key – Life insurance isn’t an investment replacement; it’s a financial safety net.
- Tax Advantages – Some policies (like permanent life insurance) offer cash value growth with tax-free loans.
- Guaranteed Payout – Unlike investments, which fluctuate, life insurance provides a guaranteed benefit to their loved ones.
Final Thoughts: Make Tax Time Work for You
Many people have more financial flexibility during tax season, making it the perfect time to discuss life insurance. By proactively addressing common objections with clear, empathetic responses, agents can help clients make smart, informed decisions.
Next Steps for Agents:
✅ Use these rebuttals in client conversations. ✅ Highlight tax refund benefits. ✅ Educate clients on affordability and flexibility.
Want more high-quality leads? Badass Insurance Leads connects you with motivated prospects who are ready to take action. Contact us today!
