The odds of selling a product to a new customer are 15 percent, while the odds of selling to an existing customer are 50 percent. Identify good prospects from your current client list.
Who are your best clients to open a DI conversation with?
There are several factors to consider as a broker when it comes to pitching disability insurance to a client. You want to consider their age, their economic standing, and their career. Disability insurance helps to protect an individual from significant financial instability if they were to become too sick or injured to work for an extended period of time.
Here’s three top prospect groups to consider:
- Business Owners
- Young Professionals
- Executive groups
As a broker, you meet clients in many different types of careers. Small business owners can especially benefit from disability insurance. Owning a small business presents several unique challenges that should be considered by the owner. Not only does this client have to worry about their own expenses, but they also have to worry about their business expenses. Suffering a serious sickness or injury can impact a person’s personal and professional life. When discussing disability insurance with a small business owner, it is beneficial to highlight their unique challenges and disability products that can offset these challenges.
In addition to individual disability income to protect the owner’s income, business owners also need to protect their businesses in the event of disabling injury or sickness. Business overhead insurance will pay the expenses of the business for up to 24 months, key person disability income protects the earnings of the company in the event a person vital to the operation is disabled, and finally buy-sell provides the funds to buy out a disabled partner. One client can lead to multiple sales.
Young Professionals are Ripe for DI
Young professionals are excellent prospects for DI. They are young and healthy, so they are good prospects for simplified underwriting–no financial or medical underwriting when applying for benefits under $6K. In addition, their incomes will grow throughout their careers, providing opportunities to exercise future purchase options.
Millennials face different financial challenges than baby boomers. Both discretionary and non-discretionary spending patterns have changed. Student debt aside, this generation spends 145% more for education than the Boomers; 73% more for health care, 48% more for rental housing, and 29% more for pension and retirement savings.
The trend of defined contribution retirement plans means individuals are responsible for a greater portion of retirement savings. A disability product that offers a student debt repayment feature or a plan that continues contributions to retirement accounts while disabled address some of the primary financial concerns.
Millennials are now the largest segment of the labor force. Understanding the unique challenges they face can help you develop your DI insurance marketing strategy for this market.
Executives are Often Underinsured
Executives earning top salaries and bonuses may come up short with group long-term disability (LTD) at work. In fact, group long term disability plans actually are often worse for executives than the average worker.
Most group LTD plans cover 60 percent of the insured’s income up to a maximum benefit amount . So, executives and professionals who earn salaries in access of the maximum benefit will actually receive benefits that are less than 60 percent of their salaries.
While the group LTD benefit is sufficient for employees making less than $100K, it doesn’t replace anywhere near 60 percent of regular salary of high earners.
The higher the salary over the maximum benefit cap, the lesser the replacement percentage for the executive.
If your client is part of an executive team, another option is guaranteed standard issue (GSI). This product offers a layer of individual disability income protection to groups of executives in a company. The premiums can be employer paid or employee paid. The advantage is GSI has no medical underwriting and requires only a census for financial underwriting. It takes care of all the executives in the group, without worrying that some may not qualify due to pre-existing health issues.
Source Brokerage disability income specialists can provide a GSI quote for your executive groups. We can also help you with the presentation and sale.