If you're not talking with your clients about the importance of disability income (DI) protection, the real question is -- why not?
You have heard all the disability-related statistics. You know that an individual between the ages of 25 and 64 is three times more likely to be disabled than to die.1 You know that if your clients were sick or hurt and couldn't work, at some point most would find it difficult to pay their bills. The life insurance you've sold them, meanwhile, might provide some money (through withdrawals and loans) for a limited time, but can be no more than a short-term help in paying for their mortgage, utilities, groceries, or monthly credit card payments.
Knowing this, then, what is preventing you from talking to your clients about DI protection?
We recently recorded two PodCasts featuring three experienced DI agents who share their approaches to selling disability protection. Their stories address the most common reasons given by agents who aren't selling DI:
o DI is too complicated;
o DI underwriting is complex;
o DI is too expensive;
o I don't have enough time to sell another product.
If you've used any of these reasons for not selling DI, it's worth your time to listen to what these successful agents have to say.
How to Sell DI (PodCast I)
Marshall Gruening is a Wisconsin general agent (and previous LIS author) who has specialized in selling disability protection to the middle-income market for more than 42 years. Dale Kelshur works with Marshall and runs a property and casualty (P&C) agency in Madison, Wis. Dale started selling disability income protection to his P&C clients in 2005 and sold more than 75 DI policies in 2007.According to Marshall, the opportunities to sell disability protection in the middle-income market have never been better. There is not much competition in today's DI market, especially in the middle income segment. Equally important, he says, is that several carriers have made tremendous improvements, not only in their DI products, but also by simplifying the underwriting process and not requiring income documentation in some cases.
Marshall believes the primary issue in selling DI in this market is affordability. To address this, Dale and the brokers Marshall works with generally sell a two-year benefit. Marshall believes strongly that it's better to have some disability benefit rather than no protection at all.
Dale started selling DI to his homeowners' and auto insurance clients as a way to increase client retention. He initially thought he didn't have the time to talk to his clients about disability coverage because he already was busy with other insurance products. But, realizing the value of the product, he found a way to work DI sales into his presentations in an efficient way. Dale uses the "BTW" ("by the way") approach to ease the transition to selling DI. When talking with clients about auto or homeowners' coverage, he simply asks the question, "By the way, who handles your disability income insurance?" The typical responses he receives include:
o "I haven't done anything about that yet."
o "Maybe we should talk about it."
o "What's disability income insurance?"
He then tells his clients that DI can help protect their income when they are sick or hurt and can't work.
How to Sell DI (PodCast II)
Chip Monahan, a disability income and critical illness specialist with The Ark Group in Omaha, Neb., is featured in the second PodCast. Chip started in the insurance business 15 years ago as a career agent selling high-deductible health insurance, primarily to realtors. He soon realized there was a natural connection between the high-deductible health plans and disability protection for these self-employed clients. The same illness or injury for which his clients were buying health insurance, to cover medical expenses, could also cut off their income if they were unable to work for a period of time. It struck him -- how would these clients even pay their health insurance premiums if they were sick or hurt and couldn't work?
Without disability income insurance, Chip's clients have a major gap in their financial protection, and he makes sure they know that. Without DI coverage, a short- or long-term financial plan can fall apart quickly.
Chip focuses his client presentations on the need for DI protection, not on the product itself or its features. One of the most common mistakes agents make when they are new to selling DI is focusing on the product. With their elimination and benefit periods and definitions of disability, DI contracts can confuse many prospects. The client's main concern is, "What will it do for me?"
Chip's analogy for DI is the difference between a drill and the hole it makes. When someone goes into Home Depot or Lowe's to buy a drill, what they are really buying is a hole. They are interested in the end result and what the drill will do to accomplish it. When an agent discusses disability income protection, the clients want to know how their bills will be paid if they are disabled.
In PodCast II, Chip shares some suggestions for agents who want to become more comfortable selling DI. He found support not only from the home office, but also in working with a general agent. Another good alternative is working with a DI specialist and splitting commissions. The DI specialist can do the work to establish DI protection on your clients, or you can market and sell the DI and simply use the DI specialist as a valuable resource.
Successful DI agents such as Marshall, Dale, and Chip have found that asking one question in particular will generate sales: "What would you do if you didn't have a paycheck because you were sick or hurt and couldn't work?" After asking the question, they stop talking and let their prospect answer. With that one question, most people will realize they have a problem if they don't have disability income protection.
Asking your existing clients that simple question is the best place to start selling DI protection. It works whether your clients are auto, homeowners, health insurance, or life insurance clients. And, the best time to start asking the question is today.
The PodCasts will be posted on the Life Insurance Selling Web site (www.lifeinsuranceselling.com) under "PodCasts" on the main menu. You can also find them at the Assurity Life Web site, at this URL: www.assurity.com/resource/LIS0208SmithPcast.htm.
Ken Smith, CLU, is director of critical illness and disability income for Assurity Life. He has more than 25 years of experience in the insurance industry, both in the field and in the home office. Prior to joining Assurity, he served for more than 10 years as first vice president of critical illness and disability income for Mutual of Omaha. Mr. Smith also is the current president of the National Association for Critical Illness Insurance.
Footnote
1. JHA Disability Fact Book, 2006.
