Understand your client’s occupation. What does he do daily?
Get to know what your client feels are his "substantial and material" duties
If you get up and go to work in the morning, you have a need for disability insurance. The first step in selling disability insurance to your client is to understand what it is your client does. You may want to begin your discussion of disability insurance by asking your client to simply explain what it is they do on a regular basis. What essential tasks do they perform that – if they were unable to perform them – they would want to be considered disabled? Take note of all duties, this will help insure that you are proposing the most accurate and competitive product.
For example, an executive that often travels internationally for business, is considered a different risk than an executive whose travel is limited to the US.
Develop the Need – a virtual disability
Ask your client how they see themselves being disabled
Understanding how your client does their job, should also help you understand what type of disability scenario they might be concerned with. If you ask your client how he sees himself being disabled, many will reply, “I don’t know, I never really thought about it.” And that is exactly the point: most people don’t think about being disabled until some event forces them to. Your job is to make them think about it and prepare for it before the event takes place.
If your client is under 50, they probably fear the catastrophic “car accident”, and if they are over 50 sickness is often how they see themselves being disabled. The fact is most permanent long-term disabilities are the result of an illness. Either way, attempt to have your client experience a virtual disability so that they begin to understand the hardships involved with a disability, and how they are unprepared to face them.
Highlight Disability Insurance Policy Benefits – The premium is the solution, not the problem
When does the policy pay benefits?
Describing the benefits of any disability policy is not an easy thing to do, especially if your client is not familiar with insurance lingo and jargon. One approach is to describe the different claim scenarios that exist and then explain how the product would perform and pay benefits. Again, it is most helpful to fully understand your client’s job duties so that you can tailor the claim scenario specifically to your client’s occupation.
The four general claims scenarios that exist are:
Unable to perform the duties of any occupation.
Unable to perform the duties of your regular occupation, but able to do another occupation.
Able to perform the duties of your occupation at a reduced capacity.
Fully recovered from a disability, back to work full time, but still suffering a loss of income.
Apply these 4 scenarios to the coverage you are proposing, and you will have covered all of the situations someone could find themselves in at claim time and the benefits they could expect to receive. This should result in a good discussion of the policy and how it works. It does not however address the number one objective, which of course is the cost of the coverage. Insure your client realizes that the premium is not the problem, it’s the solution. Nonetheless, putting the premium in perspective is a critical part of the sales process for disability insurance.
Put the premium into perspective
Make sure the relationship between the potential total benefit and the premium is obvious
The first question many clients ask when approached about disability insurance is, “How much does it cost?” Given the many variables (i.e.: age, gender, occupation and smoker status) that affect the premium, the answer is not as easy as your clients may wish. A good approximation is that it costs 2% – 5% of someone’s gross earnings to protect 60% – 65% of someone’s net income on a tax-free basis. The point is that while we state disability benefits in terms of a monthly benefit, the potential benefits we are providing often exceed $1,000,000. That helps put the premium into perspective.
Is it reasonable to spend 2% – 5% of your income today, to insure you receive your potential income from today until age 67? Put this way most clients would agree that the premium is not the problem.