DALLAS — When offering insurance to the Latino community and underserved a workshop at the conference on serving the underserved highlighted specific needs credit unions need to examine as many members of those communities have never had insurance before.
As mentioned at the 34th Annual Conference on serving the underserved and 5th Latino Credit Union conference (see Staking Out the Stats, page 14), a survey showed that insurance is one of the top financial services Latinos listed they were interested in. However, facilitator of the workshop, Maria Martinez, president/CEO of Border Federal Credit Union, pointed out that because many members of this community have never had insurance before, credit unions need to examine the way they present the service to these members.
"Because they're not used to having insurance, it's really hard to sell them the product because you have to sell them the idea of it," Martinez said. "A lot of the time you need to use real experience and say this is what happened to this person. It's different to sell insurance to the Hispanic community than to those of us who have been in the states for a while and know it's really costly not to have these products in the long run."
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Javier Tejeda-Vera, vice president for Latin America and the Caribbean at CUNA Mutual Group, discussed how the very word insurance frightens these members.
"The key aspect of the word insurance is the word insurance," Tejeda-Vera said. "It has the negative connotation that people think, 'Oh, my God, they're going to take my money and not pay me.'"
Tejeda-Vera said that when serving the Latino community credit unions must have a strategic plan and offering the appropriate products is extremely important.
He discussed offering a remittance protection plan so that if a person passes away a remittance can continue for a certain number of months. He recommended a funeral insurance protection plan that can cover the cost of funerals for up to six members of the family. Golden Harvest was another product he discussed; it is a savings plan where members can sit down and discuss what they want to save for and determine a length of time to save and achieve that goal. Insurance can ensure this goal is still achieved, even if a member dies.
Steve West-Rosenthal, group head of the insurance division at United Nations Federal Credit Union said that a lot of what he talks about with clients just deals with learning the ropes.
"In order for someone to make a purchase, we don't use hard sell or scare tactics. We use consultative sales that require financial literacy. We show that insurance is there to help you in the long run."
West-Rosenthal discussed some of the challenges that face the Latino community that relate to insurance. One challenge he talked about was that some people cannot legally drive in this country but need to be able to get to work or people that cannot afford to buy a car. A solution to this issue would be a van pool service that credit unions can offer through a CUSO. The vans are owned by the CUSO and members can buy shares of the vehicle that covers the purchase of the unit, maintenance and upkeep, insurance, gas and salary for drivers.
One drawback of the program, West-Rosenthal mentioned, was that credit unions need to review with local counsel to make sure they avoid livery status. However, he said that solutions to issues these members face are out there you just need to know where to find them.
"You need to look and find partners that you can work with that can find and supply products and services that are needed by your individual members."
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