Advisor Today - March/April 2016 - (Page 42)
SALES & MARKETING
By Ali Agha, CFP, ChFC, CLU
Working with Muslim-American Clients
The key is to help educate them about personal responsibility so they can provide for their loved ones-
in good times and in bad.
"God will take care of my
family if I die. I'm not worried.
Insurance is haraam (forbidden)."
client's goals for his
family and help him
calculate his human
hen I heard these words
from a prospect, I was a
new agent at the time, sitting
in a modestly furnished living room.
Upon the walls were pictures of family,
beautiful Arabic calligraphy of God and
Muhammad and a clock, its ticking
sound filling the awkward silence. The
couches were worn from use, hosting
many guests over the years. Now, I was
the guest, sipping tea and having one of
the most important conversations in my
Those words rang in my head like a
death knell. I didn't know what to say;
so, I left. "How could I possibly argue
against that?" I asked myself, trying to
rationalize my failure to help him.
Like anyone who doesn't get what he
wants, you start to blame yourself and
then end up blaming the other person.
When the storm of emotions dissipated,
I asked myself, "What could I have
done differently?" The answer, it turns
out, is education. By educating myself,
I can educate my prospects. As John
Maxwell says, "Sometimes you win,
sometimes you learn."
The Muslim-American market
According to America.gov, 45 percent
of Muslim-Americans have yearly
incomes above $50,000 (higher than
that of the national average), with a large
concentration of them in lucrative fields,
such as IT, education, medicine, law and
entrepreneurial endeavors. Especially for
advisors working with doctors, business
owners and professionals, MuslimAmericans are a fast-growing segment of
those target markets.
In order to work effectively in the
Muslim-American market, here are some
things to know:
* Focus on investments rather than
on interest-based products. In Islam,
collecting interest is forbidden,
42 ADVISOR TODAY | March/April 2016
while receiving capital gains from
investments and dividends is
acceptable. Therefore, variable life
insurance products, which have an
investment component, as well as
participating dividend-paying whole
life insurance, are appropriate vehicles
for discussion. However, this depends
on how religious the client is; so, it's
important for a financial professional
to ask questions and understand how
the individual feels about investing
and saving money.
* Insurance can be perceived as
"gambling." The common belief for
more conservative Muslims is that
insurance allows people to profit from
the death of another. They may also
believe that life insurance is "insuring
against death," which contradicts their
belief that God ultimately determines
how and when a person will die. The
key is to understand exactly what the
client's goals are for his family, and
then help him calculate his human
life value. It is not insuring against
death or profiting from it; rather, it
is a way to protect the members of
the family (beneficiaries) so that they
can continue to live with dignity, if
the individual responsible for the
household were no longer there to
provide for them.
* Insurance is already a concept in
Islam. According to the Fiqh Council
of North America, many Muslims
misunderstand how insurance works,
including many Imams (scholars).
Some Imams argue that "conventional
insurance" is gambling because you're
paying money with no guarantee of
a benefit (in that case, permanent
insurance is important!).
However, many Muslim countries
have local "cooperative insurance
companies" called Takafuls. These
Takafuls act like a mutual insurance
company, formed solely for their
Similarly, there is no guarantee of
a benefit from a Takaful either. The
key is to educate the client on how
insurance works, in that it's many
people contributing into a pool of money
to assist each other in the event of a
However, insurance has the added
benefit of maintaining dignity and
privacy for the family rather than
relying on a community-funded Takaful
that may not be able to pay the full
amount needed by the individual family
member(s) at the time of need.
* Take time to understand the root
of the concern. Islam is a global
religion of 1.5 billion people. While
many think that most Muslims are
Middle Eastern, they only comprise 20
percent. It is important to understand
the individual basis for the concern
and assist accordingly. Who are the
key people influencing the client's
decision (Imam, parents, etc.)? Some
cont'd on page 47
Table of Contents for the Digital Edition of Advisor Today - March/April 2016
From the Editor
A Question of Ethics The Details Often Make the Difference
What's Ahead for Financial Advising?
Whos's Saving the Most and Why?
Making the Case for Critical Illness Insurance
Are You a Retirement Expert?
Selling the "Best Plan"
Taking Incremental Steps Toward Success
Investment Strategies for Today’s Consumers
How Tax Efficient is Your Investment and Retirement Portfolio?
Ideas for a Profitable Practice
Crossing the Two Client Relationship Bridges
Working with Muslim-American Clients
Attracting and Serving Today's High-Net-Worth Clients
Becoming a Networking Success
Advisor Today - March/April 2016