To successfully sell individual disability insurance, you must understand the prospect's needs and the potential effect a loss of income will have. The difference between salespeople who consistently close sales in the IDI marketplace and those who have sporadic or little success can often be found in the way that they understand and identify their clients' main areas of concern.
While income protection should be important to all clients, the reason why they do or don't purchase disability insurance varies. The more producers understand about their clients' goals, dreams, fears, likes, dislikes, and family values, the better positioned they will be to make recommendations on how to mitigate the risk of a potential loss of income that can negatively affect certain valued areas of a client's life.
For many clients, the ability to pay their mortgage during a time of income loss is often a great place to start. After that, it is up to producers to ask enough questions to help their clients clearly see the need to protect income. Financial obligations, as most of us know, can be a cause of great stress in our lives. Mortgages, car payments, food, clothing, children's education, and retirement are just a few examples of potential ongoing stresses in a time of financial difficulty.
Know the facts
- Ninety percent of wage earners rated their ability to earn an income as valuable or very valuable in helping them achieve long-term financial security — wage earners perceive their ability to earn an income as even more valuable than retirement savings, medical insurance, personal possessions, other forms of savings, or their homes.
- Sixty-one percent of Americans could only live on their savings for three months or less if their income was lost; 38 percent say they don't even have enough funds to sustain their expenses for one month.
- Nearly nine in 10 workers surveyed (86 percent) believe that people should plan in their 20s or 30s in case an income-limiting disability should occur.
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- Only half (50 percent) of all workers have actually planned for this possibility.
- Fewer than half (46 percent) have even discussed disability planning.
Focus on what's important
Many clients do not think about a potential disability – or the effect this will have on their finances and family. In part, this is due to the fact that their insurance agent or financial advisor does not bring the topic to their attention. In order to provide a financial solution and some protection to your clients during a time of disability, you as their advisor need to understand which potential stress-inducing concerns they rank as the most important, and provide IDI as the proverbial parachute in a time of need. Producers who effectively sell disability on a consistent basis do so by focusing their conversation on the need for income protection, rather than on the product itself. By discussing how an injury or illness can affect the areas in a client's life with the highest value, producers can keep their clients centered on what's important, rather than losing them in the intricacies of a disability policy's mechanics. The end result is the key to the sale and the main benefit for the client: providing income during a time of need, which allows the client to focus on getting healthy.
To have greater success closing IDI sales, try spending more time asking questions and getting a true understanding of your clients' concerns. Keep the sales process simple and to the point, and stay focused on what's important to the individual client. Once you know what keeps your client awake at night, you'll be better equipped to provide them with an income protection product that will help put their mind at ease.
Tedd Hikes is senior vice president of Crump Annuity and Disability Solution Centers. He can be reached at 800-582-7785, ext. 7916, or [email protected].
