Back To Basics: Disability Insurance Selling
By Steve Brady – 2nd Vice President, Individual Disability Insurance Sales
Vince Lombardi's name graces the Super Bowl trophy. As head coach for the Green Bay Packers, he played a key part in winning the first two Super Bowls. He was famous for getting back to the basics of blocking and tackling.
In our world of individually underwritten disability insurance, it's the basics of blocking and tackling that make the sale. In this article, I'll focus on the most elementary yet necessary part of the IDI sale — the presentation of the illustration to the customer.
Too many times we skip over the process of developing the need for IDI and go straight to the premium page of the illustration.
Page 1 has six key words requiring individual attention: Your Personal Disability Income Protection Plan.
This is all about your customer and his or her future. Each individual is as unique as his or her fingerprints. The discussion with the customer needs to uncover what each person really wants in life and is working towards. Key questions include:
- What makes you unique?
- What drives you?
- What imprint are you trying to make in life?
This is where the interaction goes beyond the surface in all aspects. Key questions are:
- Why did you choose this profession and what makes you different from your competitors?
- What is important to you in life: family, success, reputation, work/life balance or hobbies?
- What are your passions?
- Do you see any obstacles to your success?
Next, bring in page two of the illustration and talk about disability. Use the graph to talk about how long a disability lasts.
Key questions are:
- What do you know about the impact of a disability?
- Do you know anyone who is disabled or who has felt the financial impact of disability?
- Does it surprise you that the average disability lasts around five years?
Income is the customer's greatest asset. The income stream while the customer is able to work is usually the largest resource he or she will insure during a lifetime. Individuals accumulate income to create net worth. In determining the amount of disability income insurance, insurers look at prospects' "yet worth" and what would be lost if a disability were to happen during the customers' working years.
Key questions are:
- How important is a continual uninterrupted stream of income to support your standard of living?
- Are your income and the ability to earn your income your most valuable assets?
No one can protect your customer from a disabling event taking place. Insurers can protect from the devastating financial impact of a disability.
Key questions are:
- Do you see the value in protecting your income against the event of a disability?
- Do you feel exposed to a risk of potential harm to your dreams?
- Are you interested in creating the peace of mind that protecting your income can create?
Everyone has a plan even when they're not aware of it. Having no plan is still a plan. Self-funding to prevent or minimize income loss resulting from a disability is the most common plan. The goal of discussing plans is to have insurance viewed as the most sensible plan with respect to cost and timing.
Before you present the insurance plan, first play out the self-insurance plan your customers already have. Bring that scenario to life by having your prospect visualize being disabled:
Let's pretend that you experience a typical disability and can't earn your usual income. Most disabilities occur between the ages of 50 - 55 and last for five years. How much would you need to set aside to self-fund your ability to meet your financial obligations?
To estimate: multiply monthly income needs by months of disability, then divide by the number of working years remaining before age of disability.
For example, here's a 35-year-old estimating disability occurring at age 55:
$3,000 monthly income need x 60 months (average length of claim) = $180,000 ÷ by 20 years (years before disability) = $9,000 to save each year, or $750 each month.
If you knew in advance that you'd experience a situation like the one above, would you be able to save the $750 a month to self-fund your disability?
What's wrong with a self-funded plan? Timing! What if the disability happens at age 45 instead? What if the disability lasts longer than five years?
Ask your customer: "What if I could show you a plan that costs around $75 a month and will pay the needed $3,000 for as long as your disability lasts? What's more, you'd be protected immediately, even if a disability occurred the day after you purchase the policy and lasted the rest of your working career?"
Next, show page 4 of the illustration and circle the monthly premium and total annual benefits available. Then show them the total benefit available on page 3 so that they can see just how valuable this coverage can be.
This process of selling IDI allows income interrupted by disability to be seen as a problem for which insurance is the only viable solution. This sales process also avoids "definition-paralysis." The remaining pages of the illustration are then left behind as support material. The definitions reaffirm the sale; they do not create it.
Practice these six steps to selling just as any sports professional would practice before game time. Once you're comfortable, you can approach anyone with this simple question: "What Is Your Personal Disability Income Protection Plan?"
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