As a nonprofit leader, you are always looking for new ways to manage your organization’s investments and fundraise to support your organization’s mission. One source of revenue you may not have considered is life insurance policy donations. By encouraging your supporters to donate life insurance, you can generate significant funds and make a huge impact on your organization’s mission. In this article, we’ll share four expert tips to help you attract more life insurance policy donations to your nonprofit and maximize your fundraising potential.
4 Effective Ways to Educate Donors About Donating Life Insurance
Let Your Network Speak for You
This is an example of how your prep work can pay off in the long run. Create a printable / rack card / brochure that you can give to local companies in your community. This handout should highlight the benefits of donating a life insurance policy and also share the impact a gift like this can make. Make sure to provide an overview of what your organization does, who it helps, and why it’s important. Sharing stories will allow the donor to better connect with and remember your organization’s impact.
This information can be distributed to funeral homes, life insurance companies, and estate lawyers. These professionals deal with death constantly. Sometimes, an individual or family will ask for their recommendation on where to make a donation. If you take the time to build a relationship with these companies and give them the materials to make their jobs easier, you will be at the top of their mind when they make a recommendation to their clients.
Celebrate Life Insurance Policy Donors
A great way to encourage others to make a life insurance policy donation is by showing social proof. Publications such as the book Influence: The Psychology of Persuasion by renowned psychologist Robert Cialdini, Ph.D. highlight the power that social proof has on individuals. In his book, Cialdini states, “We view a behavior as more correct in a given situation to the degree that we see others performing it.”
Creating a giving society is a great way to honor major donors. According to Philanthropy Daily, nonprofits that have a donor club and consider it an important part of their fundraising efforts have an average per-donor contribution level 49.6% higher than those that don’t!
So celebrate when you receive a donation of a life insurance policy and shout it from the rooftops! Share stories about the donor and the work that was done with their money in your supporter newsletter, add bricks/naming trees in your lobby, honor them at your fundraisers, etc. Anywhere that you can talk about this type of donation, do it. Sharing social proof will continue to familiarize and disarm the donor’s brain from this new type of donation.
Hold a Legacy Event Each Year
Once you have begun to receive donations of life insurance policies, you should consider hosting a memorial event once a year for the families of the donor. If the donor is still alive, this is a great chance to celebrate them and nurture their relationship further! Allow them to invite their friends and family so they can learn about the legacy they are leaving. Having your board members there to mingle is a great way to show that your organization truly appreciates them.
If the donor has passed away, invite their immediate family members each year to this event. Most people would love to continue to remember and honor their loved ones in this way. This event doesn’t have to be anything fancy or expensive. Providing light snacks and refreshments with a short program highlighting donors and the impact they’ve made will go a long way.
Holding this event has two main goals. The first is to allow the donor’s family time to celebrate the life and gift that was made by the donor. The second is to nurture this new group of potential donors! Many people will feel compelled to make a donation in the name of the deceased, or may even fall in love with the idea of donating their own life insurance policy. Have your development team available to talk with donors, build relationships, and answer questions about potential donations.
Include Life Insurance Donations in Your Overall Fundraising Plan
It’s important to include life insurance policy donations in your overall fundraising and communications plan. Most donors don’t know it is an option, let alone all the tax benefits. It is your job to educate your donors on every opportunity they have to support your mission. The Rule of Seven refers to the fact that modern brains need to interact with something seven times before it will take action. And remember that every donor isn’t seeing every piece of content you put out. Don’t be shy about spreading the word!
Mention it on your remit envelope, on your website or landing page, and in your donor welcome series. Highlight it on your Form 990 when reviewing it with donors and periodically at board meetings, fundraisers, and community outreach events. If you don’t share about it, your donors won’t be able to act because they won’t know about the possibility.
When Talking About Life Insurance Policy Donations Matters
By not educating your donors on life insurance policy donations, you are losing out on a large revenue potential for your organization. In addition, you are denying the donor the chance to make a significant impact on your mission and to optimize their tax savings.
Don’t let your fear of being uncomfortable hinder the mission you serve. By being prepared, remaining compassionate, and educating the right donors, you will attract more life insurance policy donations to your organization.
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