In the old days, sailors used a term to describe a state where they were motionless and had no wind to propel them. Although you may have heard it many times, you probably haven’t thought of it in connection to disability insurance. Are you right?
Here’s your wakeup call: It is time to THINK! A staggering 30% of all applications for disability insurance (DI), are not accepted. Some get declined, others are rejected by the client and others are never accepted due to insufficient documentation or incomplete fields. This statistic does not include income protection applications that are never submitted. My guess is that less than 60 percent of sales appointments result in an application submission.
How do you chart your course for selling disability insurance? Are your cases doomed to fail? Are they able to build momentum and reach a signed-and-delived status? Are they being held back by a headwind? Although sailors in the past could not control wind, they were able to do much today. Six critical SALES KILLING errors are made by most agents while filing their files. Three of these mistakes will be shared here. To see the complete article, visit the Disability Insurance Service Website.
The #1 Killer in the Insurance Industry: Marketing to the Wrong Audience
There are many good audiences. All of them have one thing in commun – they are all high-income earners with a strong need for protection of their paychecks. Do not set your sights on low-income prospects, no matter what you do. You won’t sail. These are some good prospects to consider when selling individual disabilities insurance.
- Traditional white-collar market: Consists of dentists, lawyers, and other similar professionals. This audience can be reached through hospital endorsements and professional and trade associations.
- Freelancers and owners of small businesses – Many people in this group have very high incomes but do not have group insurance. Reach this audience efficiently through trade journals lists, alumni associations, and professional associations.
- The “sandwich generation” – This is a generation that finds themselves in a difficult position between their children and their parents. Target only those who have high incomes, and appeal to their obligation of supporting their loved ones, no matter what.
- Dual income families – These people have twice the income to protect and darling children who will need all manner of luxury indulgences for many years to come. Appeal to their altruistic desire to give their children every advantage. Look into obtaining endorsements from private schools, sporting associations, and other venues that are trusted by families.
- Baby boomers – This group is at peak earning power and highest obligation levels. They finance vacation homes and college tuition. You should consider more than income and age when purchasing marketing lists. You can also add demographic qualifications such as your home value. Numerous online listing companies offer advanced selection capabilities.
- Single parents, never-married people, and divorcées – These individuals are the sole income earners of their families. In the event that they become disabled, there is no one to turn to. These people may also not have a lot of savings making it difficult to sell disability insurance. Remember to only market to people with high incomes.
Insurance Sales Killer #2 – Assuming you need
High income is necessary for selling disability insurance, but not high net worth. People with net worths in excess of $6million are more likely to be able to cover their expenses if they are disabled. They wouldn’t waste their money on disability insurance policies. They won’t. It is not necessary. This type of prospect is not even covered by many insurance companies.
Watch out for people with high levels of unearned income, i.e. income from rental properties and other investments. Unearned income that is higher than earned income will be considered a low-risk candidate for disability insurance. Unearned income does not stop with the loss of income. Before recommending disability insurance policies, we must carefully assess the prospect’s needs. These prospects are often better suited to long-term or critical care products.
Also, review any existing disability insurance policies of the prospect, including employer-provided coverage. Don’t make the error of trying to insure too many clients. You might recommend a supplementary plan to supplement existing protection policies.
If you assume that only those who have high net worth will need disability insurance, you’ll be in serious trouble. Ask the right questions and listen carefully to the answers.
#3: Selling low-value/high-cost disability insurance is a killer strategy for.
You’ll get $4,000 per month in tax-free benefits, all for a $4,500 annual premium. These words can lead to policy cancellations. This is because they compare a monthly low value (monthly) with an annual high price (annual).
Selling apples to oranges is a good thing, but it’s important to do it correctly! My sales script, The Wealth Preservation Plan teaches agents how to sell highest denomination values for lowest prices. The prospect will be more likely to remember my offer if I show them the high-value items that are less expensive. When I show the daily cost of protecting a car worth $35,000 or a house worth $400,000, and then calculate the value of one’s paycheck from now until retirement (usually at least $1million), my prospect expects that the price of protection will be high. I ask, “If it costs $3.50 per day to protect your car worth $35,000, what is it worth to protect you paycheck from now to retirement?” Many people believe it is worth $10 per day or more. The prospect is shocked and relieved when I reveal the cost of the premium for disability insurance (in the lowest denomination, cost per day terms),
