Investment advisory service is one of the most interesting job profiles. It will help you increase your knowledge in the financial domain, which is the most important driving force for life. Suppose you are a person with an optimistic attitude, an influential personality, enhanced problem-solving skills, analytical skills, and sound knowledge of legislation and regulations; you deserve to be an investment advisor.
 

Who is a Registered Investment Advisor?
 

 A registered Investment Advisor (RIA) is a person or an entity that can provide investment ideas and solutions to people seeking them. They are registered with the market regulator, India's Securities and Exchange Board. They are obliged to be more loyal to their clients than the company to which they belong. 
 

Any person or firm planning to engage in a business to provide investment advice needs to abide by the regulations of SEBI and register to become an investment advisor. SEBI mandates the qualification and eligibility criteria, fees to charge, implementation terms, and agreement with the client. Professional qualification or postgraduate degree in finance or five years of experience and having a National Institute of Securities Markets (NISM) level 2 certification are necessary for becoming an advisor.
 

The investment advisors should also meet the requirements concerning net worth. For example, the net worth of an individual wanting to become an investment advisor is ₹5 Lakh. 

Here are a few tips to become an effective investment advisor.
 

Have thorough product knowledge.
 

A thorough knowledge of the different term plan products is necessary to be a good investment advisor. If the client is asking for the features and benefits, you should be able to provide them in a detailed and understandable manner. Be very specific about the term policy. Understand what the product is, why is it necessary, and how it will benefit people. Also, you should be able to find out which section of people will draw the maximum benefit from a particular product. If needed, first explain to them what life insurance is. The goal is to give adequate time to explain a product to them in detail. Ensure they understand how term insurance differs from other life insurance forms.
 

Analyse the needs of the client first.
 

It is your primary responsibility to serve the client's needs. You should analyze their requirements to address their needs and provide the best solution. Have a basic understanding of their personal and financial life, question them to understand their specific needs, and give the best resolution. Before you recommend life insurance products to them, understand that they should be able to pay the premiums regularly. Let them know why it is important to pay all the premiums on time and how not doing so will impact the policy and the coverage.
 

Check term insurance plans and tell them which will be an affordable solution that will suit their needs the best. Be patient and listen to their concerns with complete dedication. The client should be able to communicate openly to discuss their financial obligations. This can help them choose the correct term plan that offers adequate coverage and pay out the required amount when the need arises. If the client is unable to choose the coverage amount, ask appropriate but non-invasive questions about their family’s financial situation and future needs so that the coverage will suffice in the event of the policyholder’s demise.
 

Use technology
 

The digital world has enhanced the work culture to a great extent. Make use of the online applications and demonstrate the features and benefits to help the client understand the product better. Many people find it hard to understand how the term insurance premium amount is calculated and how it contributes to the sum assured. Use an online premium calculator to check and choose term insurance plans, to explain better. Use pictorial representations to describe the features rather than showing the brochures to explain them. The brochures provide intricate details which may not be comprehensible for all people. TATA AIA term policy features are well described quantitatively and qualitatively on the digital platform. Also, the client should be made aware of how they can purchase, renew and access their Tata AIA Life Insurance policy online, at any time, and from anywhere. However, it is important that they know all the processes from end to end, such as how they can pay their premiums online as per the premium payment frequency and digital channels of their choice, modify certain aspects of their policy online, etc. 

 

Don't keep talking about features. 
 

The majority of investment advisors try to learn as many products as possible. When they meet a client, they try to provide all the product features to market the product. Investors lose interest when such people approach them. Investors may become reluctant to meet them in the future.
 

As important as life insurance is for everyone, aggressively marketing the product to your client may backfire in different ways. In most cases, your client may feel that they are being pushed to purchase a financial product they can do without. To combat this problem, you can try and establish the importance of securing their family’s future. It is crucial that this point should be communicated effectively so that there is no misunderstanding when it comes to life insurance.
 

Get closer to the client, understand their requirements, and further conduct research from your end on what products will suit their needs better. Based on the results, list down the features of the product solution that will benefit them. Talk about the features sequentially and ensure they understand every step. If you start with calculations directly, they may lose interest. 
 

For example, a term plan is the purest form of life insurance that many people may not know about. Your client should know what this term means and why extensive life insurance coverage under a term plan is important. However, there are term insurance features that make it a very useful and necessary product. It provides an enhanced sum assured for an affordable premium when saved early. You can enhance the sum assured by adopting various riders1 in a term plan. When the features are well described, it is possible to convince the client to purchase the product.
 

Try to accept rejections.
 

One of the best and most basic qualities an investment advisor should possess is the mind to accept rejections. When clients approach an investment advisor, they listen to all the information and silently reject the product proposal. One of the major reasons for this is that clients are unaware of the payment terms when it comes to life insurance and other financial products.
 

If you are still keen on convincing the client to purchase life insurance, you can ask a few questions regarding their financial situation without being too forthright. This will help you understand if they need a term plan or any other life insurance policy immediately or a few months down the line. In the case of the latter, you can request them to stay in touch with you and contact them again later. However, if your client has no interest in life insurance, take a step back and accept the rejection.
 

So, once they understand the nature and quantum of payments, they try to neglect it. Investment advisors should understand that the clients will return when they understand its importance and worth. 
 

Conclusion
 

We have seen some important tips that will make an investment advisor very efficient. These basic qualities will ensure that you learn and widen your knowledge and analyse clients' objectives from their end. It takes time to become the best investment advisor in India, considering the demographics and varied needs and interests. When it comes to life insurance, it is advisable to read, study and absorb as much knowledge as possible about term insurance and other life insurance products in general. This can help you give your clients an in-depth understanding of what life insurance means and how it can help them and their families in different ways.
 

Keep yourself on the right track as far as product knowledge is concerned, and ensure to keep updating yourself with the latest changes in legislation. If you are passionate about investments and their benefits, you will undoubtedly become an effective investment advisor with practice and experience. Be patient and stay strong!
 

L&C/Advt/2023/Apr/1258