Now is the right time to unlock your potential as an insurance broker who has not been thriving in the disability market. These five valuable gifts will help you get started.
Gift #1 – Lackluster Competition
Selling disability insurance (DI) is a difficult task for most agents. They aren’t comfortable with the product, and they fear that they won’t be able to answer questions. Why? They haven’t done it enough. It’s not something we have done enough to feel comfortable with, whether it’s 5 year old learning how to ride a bicycle or 50 years old trying out a new product. It’s not a barrier, discomfort is a gift. This is an opportunity to work in an underserved market. Agents avoid difficult situations, and avoid selling disability insurance. This allows you to rise quickly in a competitive market.
Gift #2 – A Ready-to-Buy Audience
You can be sure that a lot of your clients will be willing to buy paycheck protection. All you have to do is ask the right questions. Here’s how:
Make five lists by going through your files.
1. Clients who have purchased disability insurance from your company in the past
2. Clients who have purchased disability insurance from another person in the past
3. Clients who are covered by an employer-provided disability plan have had to decline their insurance
4. Clients without disability insurance
5. Clients who were not previously insured
- Inform clients who have already purchased disability insurance from your company that there have been significant changes in the pricing and coverage of paycheck protection over the past two-years. It would be smart for you to go through the policy and determine if there are better options to increase coverage or lower rates.
- Ask your client if she has any disability insurance. This will generate interest and confusion. Explain that the policy must have been purchased at least two years ago. If so, you may be able to improve the rates or provisions based upon recent significant changes in the protection of your paychecks.
- Employer-provided group disability insurance is a way to say that a client feels very lucky. It is a great feeling to work for a company that cares so deeply about its employees. You are likely to receive 60 percent of your income through your plan, right? If the client agrees, tell them, “Well, I’ll ask you a question… Do you know when 60% does not equal 60%?” The client will then ask “When?” You’ll answer, “When it is an employer-provided program.” Your DI benefits will be taxable because employers deduct the cost for DI premiums from your taxes. Your net benefit amount will therefore be 42 percent instead of 60 per cent. Are you able to maintain your lifestyle with only 42 percent of your income. It’s worth looking into a supplemental policy for disability insurance if you are unable to. Find out more about the current coverage to create a smart supplemental policy.
- Contact your client immediately if she doesn’t have disability insurance. As an insurance advisor, it would be negligent if you did not suggest protection for the client’s most valuable asset – her paycheck.
- Ask permission to look at a client who was not insured previously. The market has seen new products, lower prices, and a softening of the disability insurance underwriting standards in the last few years.
#3 – Buying Signs
A price objection to disability insurance is an indicator of interest and a buy signal. Although price objections might not seem like a great gift, they are actually a gift if they are understood and overcome.
#4 – A Sustainable Income
LIMRA International, Inc. reports that the average persistence for term life insurance is 6.6 years. The average persistency of disability insurance is 12.2 year, almost twice the length. Do you see the gift? It is here… You open the door to a source of income that is highly sustainable when you sell a policy for disability insurance. Many seasoned agents will admit that they wish they had started selling disability insurance sooner in their careers. They now realize that if more DI was sold back then, they would be able to take a lot more vacations.
Another income argument is: You likely already know that clients’ incomes and lives change, so it is important to ensure that their disability insurance benefits are not affected. Many disability insurance policies offer a future purchase option. This allows you to increase your client’s benefits and gives you an opportunity to get a raise in the future. Here’s the thing: If your client chooses to exercise the future purchase option, they will receive a full 50% commission for the first year of increasing their premium.
Do the math. You’ve created an unbeatable income formula if 25 percent of your clients with disability insurance take advantage of the future purchasing option each year.
Christmas #5 – Timing
Timing is everything. I can tell you that now is the best time to sell income protection. Your clients may be able to enjoy a triple-buying opportunity for a short time. There are three benefits to buying now. These arguments can be used to make your clients feel more urgent about buying.
- Relaxed underwriting makes it easier to secure coverage than ever. Many carriers now offer coverage up to $5,000 per month without the need for medical exams, blood or urine tests, or income documentation.
- Transitioning economy: Although rates are currently low, they will not stay this way for long. A stimulus package was passed by the government that will increase our nation’s money supply. Most Americans are saving money and paying their bills, rather than spending money. We may see an increase in inflation and prices over the next few years due to our abundance of money. Inflation is a classic cause of rising insurance rates.
- Age advantage: Rates will be lower if you’re younger than your peers. It’s a smart move to lock in a low rate when you are young. Your rates will not rise no matter what your age or your medical condition.
Would You Like to Open These Five Gifts?
These unopened gifts can be a source of hope, satisfaction, and untapped potential for your career in insurance sales. Are you going to sit back and watch, or will your eyes be glued? You have the power to make a decision that could change your life.
