Raymond J. Phillips, Jr., CLU, LTCP

Q: What special initiatives is your agency/company undertaking to take advantage of Disability Insurance Awareness Month? What do you do to build on your DIAM momentum to help agents perpetuate DI awareness throughout the year?

Bloch
Income protection is promoted to our producers 24/7/365. During Disability Insurance Awareness Month, our agency holds an exciting day of learning and reward achievement at our DI Day. Each year at DI Day, we provide different agendas for our producers to keep knowledge and industry trends up to date. Solutions based discussions create innovation and presentations of real world examples of the value of disability insurance, such as “It happened to me.” Our carriers send top executives to support DI Day as well as participate in carrier panels. Panels of producers share sales ideas and presentation methods to provide easy and successful ways to present income protection coverage. After lunch, there is a “fun” golf tournament with prizes and a donation to a worthy charity.

Chittenden
This year we are doing something different. Rather than sponsoring a big DI Day, we are launching a series of small regional/office DI Days. The big seminar with speakers is very effective in some locales, but we have not found it to be beneficial for us. Nor have we found it keeps the interest going no matter how excited brokers are leaving the meeting. The problem we have found with the large annual meeting is that sales come from habitual behavior and habitual behavior is not created in a once a year rah-rah meeting. So we are bringing DIAM into our brokers’ offices. We are holding a series of smaller meetings during DIAM and then establishing ongoing one hour training sessions on a monthly or quarterly basis. This way we can help our brokers develop the habit of asking the right questions to identify the problems that are solved by DI. We help them identify problems and sell solutions.

Petersen
We try and remind insurance professionals that each year DIAM highlights the need for income protection to the public through numerous tools and outlets. It is an awareness, not a sales strategy. However, it is this increased awareness that makes it prime time to focus on marketing and talking to clients about the need for income protection for both personal and business needs.

Phillips
The biggest initiative we undertake for DI Awareness month is our DI Day event along with our partner agencies in the Plus Group around the country.

Truth be told we usually don’t make it a whole day, so perhaps we should label it our “DI Morning.” For three or four hours we’ll do presentations on the products that make up the DI marketplace, and have sales sessions to help advisors with ideas and tips to sell more DI to their clients and introduce it to their practices. Very often we’ll attach Continuing Education credits to the advisors as well.

This year, our event is tentatively set at our go-to venue for our DI Days, The Rivers Casino in downtown Pittsburgh on May 22. The Casino offers beautiful meeting rooms. At our first DI Day years ago, an advisor won $800 in the casino after the event! That’s a sure way to get a repeat attendee! Although we are trying to raise awareness for disability insurance, we still try and make the day as fun as possible for anyone who attends. That’s why organizers do usually try and plan a casino event afterward. Before this next event, some guests may want to take some time to brush up on their casino skills by looking into this mega888 download. This should ensure that people stand a better chance of winning. If people want more of a variety with their online casino playing, they can look to other sites that may have what they are looking for, for example, they may want to play on 918kaya apk, or similar, to brush up on their skills, whichever one they choose as long as they play responsibly they’ll have a lot of fun. Just make sure to check how highly any online casino is rated before you start using it – the best way to do this is to head over to casino-bonus.me.uk and read some reviews. Alternatively, they could conduct a direct search using specific phrases to find the best sites to play gambling games. If a person wishes to try his or her luck at Ripple casinos, websites such as Crypto Snack may be of assistance by recommending the best ripple casino sites available online.

For us DI Awareness doesn’t only occur in May. We are constantly offering training events and opportunities during the year. We have ongoing meetings, webinars, and broadcast emails that provide advisors the opportunity to learn about DI. Our meetings take the form of what I call our “Big Hotel Meetings in the Sky” where we’ll rent a room at a hotel and bring in an industry speaker or company rep to talk DI. We hope to get 50 or so brokers to one of those events.

We also have geographically oriented “DI hand-to-hand Combat Sessions” where we’ll do smaller, more intimate meetings in handy locales, with the intent of getting 5-10 advisors in attendance. These are more intimate sessions where we’ll peel apart products and provide ideas as to how to sell this stuff.

And, of course, we’re old fashioned. We still meet with brokers to provide training in their offices to themselves and their staff-often with CE just for them.

For us there is no “DI Awareness Month” it’s more like the “DI Awareness Continuum.”

Perry/Bowden
We participate in many of our general agencies’ DI Days providing presentations on the importance of disability and awareness of the products available to clients who are not able to obtain disability in the standard market. We also provide webinars throughout DIAM to educate agents who are not aware of the high risk products that are available and how to capitalize on the declined cases they may have received.

Schnittker
This year we are doing more agency meetings, road shows, individual sit downs, presentations to local financial associations, study groups, etc. We are more visible than ever, just in different capacities. We will continue to educate going forward.

During DIAM we will utilize different tag lines on emails and correspondence. We will send out more marketing emails to our brokers discussing DIAM, and offering sales tips, marketing facts, and bringing them up to speed on the resources that are available.

Question: What challenges do you see in the DI market for the coming year?

Cohen
The challenges we face are not just in the coming year but extend into the future as well. We have to motivate  advisors to teach their clients the importance of protecting their greatest asset—their income.  A long term disability is devastating to not only afflicted but their family as well.

Another challenge that we are faced with is educating our advisors that disability income policies are underwritten differently than life insurance policies.  Disability policies are often issued with exclusion riders which exclude certain conditions.  This is the nature of the beast.  Advisors need to understand this and be able to explain it to their clients in a positive presentation so that their clients accept the rider knowing that there are a multitude of other medical conditions for which they will be covered.

I find another challenge is exposing the advisors to all the potential clients whose occupation is  not just in the medical market. Tradespeople, salespeople, business owners, etc., need to protect their incomes just as much as the professionals.  When the paycheck stops, everyone’s savings disappears.

My challenge is to educate our advisors that high income clients who have employer-paid group coverage may need individual disability income protection to supplement their group coverage.  This is a situation that many advisors walk away from. 

Mohr
The only challenge is getting agents and advisors to recognize the importance of presenting income protection solutions. Advisors just do not understand the risk until they have a client disabled. There are some very disabling viruses, illnesses and accidents that occur daily. I know of claims where the claimant is collecting on both a disability and long term care insurance policy at the same time. That should be “Priority One” for an advisor, to make sure their clients will have an income whether they can work or not. Promoting the importance of disability insurance will put advisors in front of high income clients and lead to more life insurance sales and other sales of financial products.

Petersen
More carriers, more options! This sounds good, and it really is, but it also adds more to the frustration which some producers feel about which carrier and which options for which client!

Schmitz
A shortage of trained life and disability insurance salespeople.

Baby boomers are getting toward the end of their DI purchasing lives.

Millennials prefer to buy online, which is great when buying a toaster, but maybe not the best option for buying DI. DI needs to be sold. There needs to be education and conversation. 

Phillips
One of the biggest challenges will be the sheer lack of carriers in the market.   Quietly, the number of carriers available to the independent producer has shrunk.    There simply aren’t many carriers to access.   I suppose one could spin that to a positive—there aren’t many carriers to learn! 

In addition, the upcoming year brings the age-old challenge in that it is a market dominated by “dabblers.”   Far too many producers are “one hit wonders.”   They’ll sell one or two, and that will be it.   It’s a market where sales are far too reactionary (client asking for it, or starting the conversation) and far too few that are done in a strategic manner quarterbacked  by producers.  

Question: What opportunities do you see that could/should attract producers to DI sales?

Cohen
The opportunity to attract advisors to sell disability income protection abounds.  Everyone is selling life insurance and very few are selling disability income protection.  There is very little competition in this arena. If only the advisors would ask their clients how long they can survive without a paycheck, they will see the look of interest and potential for a sale.  

When an advisor opens the disability income protection door, he/she will be amazed at the array of policies that the companies offer: A policy to fund a disability buyout, a policy to pay overhead expenses, and a rider to pay a business loan are but a few examples of what is available.

Some of our best sales have been funding a disability buy/sell agreement.  By asking the question, “If one of the owners were to become disabled, do you have a buy/sell agreement?”  This one question should create enough interest to explore this policy. I believe that this policy is one of the best kept secrets.

Mohr
First, just the desire to help and to do what is best for your client. Many clients are relatives, friends, community leaders and business associates; how would the advisor feel if one of them became disabled and the advisor never brought up the need for disability insurance? Second, income! The commissions and vested renewals that an agent can earn selling disability insurance are unmatched by any other insurance product. Third, referrals. Once you sell a disability policy you have a reason to talk to other business associates or people who work at the same job or in the same profession about income protection. 

Petersen
The same as my last answer—More carriers, more options! This means the value of the brokerage outlets becomes even higher! Brokerage outlets and new products are making the selling and administration of disability insurance easier than ever. GSI is having a record year by all carriers. Excess GSI is through the roof! Business DI programs are the most liberal and easier to use than ever before.

Schmitz
A more streamlined underwriting process. Easy access to medical information and financial documentation would generate tons of new business. In the meantime, lots of great true stories of satisfied claimants. This would be immensely helpful in our endeavors to get people to think about the need, and eventually realize income protection can be the best solution to eliminate some of the risk to their loved ones and/or business partners.

Phillips
A major reality of the DI market that should attract producers to it is that few are in it!  Competition is unusual except in the most developed market space (e.g. medical, high-income).   

Carriers are poised with an abundance of marketing materials and support for those who want to engage.  Brainsharks, pre-approach letters, seminars, mailers, email templates and the like  abound on every carrier’s website.   I don’t recall a time in my career when there have been more resources available for the informed producer to approach this market in a strategic, professional way.  Use them!

Another attraction to this market for brokers is that it can support and lead to other sales in other insurance and investments.      Gain an understanding of the client’s income, and it should  lead to conversations on life insurance and investments.   Have other product lines in-force and it will provide funding to perhaps maintain the insurance and investments that are already in place. 

Likewise, as a client’s income increases—and it will, sometimes substantially—so too will the opportunity to provide additional coverage by way of a new sale or exercising a “future purchase option” on their existing plan. 

Finally, another reality of the DI market is the “R” word.  Renewals.  For the most part, the more premium one does, the higher the renewals earned.   It is great way to build meaningful recurring revenue in an agent’s practice.  

Question: What is your view of agent responsibility to present DI and what consequences, if any, do you see affecting agents who continue to avoid this market?

Cohen
I believe that it is an advisor’s responsibility to offer disability income protection to all of his/her clients.  An advisor never wants to get a phone call from their client’s spouse with the news that their client has suffered a stroke. The spouse wants you to put in a claim for benefits for the disability. The advisor has three responses that he can make:

1). I am so sorry to get this sad news.  I will report the claim to the company and when you are ready we will review the policy; Or, 

2). I am so sorry to get this sad news. However, your spouse and I never discussed a disability income policy; Or, 

3). I am so sorry to get this sad news.  When your spouse and I discussed disability income protection, your spouse was not interested in purchasing this coverage and, yes, there is a signed form in the file with his/her signature stating that he/she was not interested in pursuing disability income protection.

Mohr
If I had an advisor that I relied on for financial advice, products and protection, and then I became disabled and had no disability insurance, I would be extremely upset—especially when I learned that income protection insurance was available to me and my advisor never suggested it. I believe that the advisor should be morally, ethically and possibly legally liable to present income protection insurance. The financial and emotional consequences are so great that advisors should have clients sign waivers that they have been shown the need for disability and long term care insurance and they chose not to purchase.

Petersen
While there is no legal obligation for a producer to talk about disability insurance, there should be a personal sense of responsibility (moral, ethical, emotional, or whatever you wish to call it) to tell clients about disability insurance. This is coming from a guy whose grandfather literally lost the family farm due to a back injury. This is also coming from a guy who has had two bouts of severe disability mishaps inside my immediate family. The first time, the absence of disability forced the liquidation of a small business. The second time, having disability insurance allowed us to keep the family home!

The consequence of this? Lost sales to the producer and underserved clients! 

By the way, if my grandfather did not lose the farm, my fathers “calling” into the disability insurance world in 1948 might not have ever happened! 

Schmitz
As I observe the aging of the salesforce, I also observe an aging of their client base. A recent inquiry was from an agent whose client was interested in DI for her grown children; both children earning six figure incomes. Many of our agents haven’t had a young client in a long time. The agent is focused on old retired and semiretired clients and their investment portfolios. Unfortunately, many new, seemingly captive advisors are focusing on investment portfolios exclusively as well. Maybe someday some advisor will be sued for not protecting an income, but it hasn’t happened or we would make a big deal out of it, like Chisolm Ice Cream.

Phillips
My view is professional agents need to understand they have clients—not customers.   Walmart has customers.   Much like due care is expected from a doctor by his patients, producers must recognize the obligation of due care to these clients.   

My observation has been that the quality agent is not on a sales call, he’s on a mission.  A mission to make sure that, should the worst case scenario occur, his clients are properly protected within the context of their budgets, needs and goals.  

Imagine having a client becoming disabled, having their income compromised, and the subject of income protection had never been broached. What view of the planner would the disabled client have, let alone the guilt feelings the advisor might have? 

Agents need to save themselves from these uncomfortable possibilities by discussing the need for DI with all of their clients and prospects.

Question: What tips do you have for agents to find success selling DI?

Cohen
My tip is for advisors is to have an organization behind him/her that is knowledgeable in disability income protection, holds regular teaching classes in disability income protection and keeps their advisors up to date on changes in the market place.  It is also important for advisors to have an organization that can teach advisors how to sell disability income protection.  An advisor needs an organization that can steer him/her through the entire process from taking the application through the placement of disability income protection policies.  Advisors need an organization that has staff that is always available to them and dedicated to their success in selling disability income protection.

Mohr
Bring it up time and time again. Bring it up to the right people, those with high incomes. Everyone needs disability insurance and there are products for all incomes. Have the income protection discussion with everyone. If people say that they are covered at work, let them know that they just have half a plan at work and that they still need a supplemental plan.

Petersen
Every client is a potential sale! Executives and professionals? No problem! Blue collar and gray collar workers? No problem! Athletes, pilots and entertainers? No problem! Also, if you have an established block of business of any sort (life, medical, etc.) you already have DI sales leads! One thing I hear often is, “Where do I find clients?” Existing clients from other sources of sales is a built-in lead system. Just talk to them! It sounds too easy, and it is, but it is amazing how many times I see a producer try to make it difficult.

Schmitz
In CA, State DI can pay $5000 per month ($1,173/week maximum). Look for people who do not have State DI, or those who earn substantially more than the limit. It helps if they are married and/or have children. The best prospect has L.O.V.E. (Love, and/or Obligation, and Verifiable Earnings). It is easier to motivate these people, and the premiums are bigger so you will earn more per case. 

Our top producers get their leads and referrals as members of the Chamber of Commerce, Rotary, Elks, Lions, and Networking groups. They are writing books, and teaching classes and volunteering in the communities where they live and work helping others. 

Phillips
This isn’t that difficult:  Just ask about the client’s current income protection.   It is easily integrated into any fact finder or in-force policy review done for other product lines.   It is a product line that is one of the least commoditized purchases in the fixed insurance markets.   A client needs to be told about the opportunity to protect their most valuable resource—their earnings.   Bringing up the subject in a consistent, methodical way is bound to have positive results.

What products does your agency offer and what suggestions do you have for producers to further protect their clients’ financial well being beyond life products?

Nardini:
We present ourselves as a full service insurance brokerage agency serving financial services professionals using a  product lineup that  consists of life, annuity, long term care, and disability income protection plans from the major carriers in the industry. Our staff has more than 150 years of experience collectively and we offer, in addition to competitive products from financially sound insurance companies, a commitment to the financial services industry, the people involved in the industry and the people they serve, to bring the best possible carriers, products and solutions for the need at hand. The client’s best interest is first and foremost the most important thing for Benefits Brokerage Agency, Inc. as we engage in the business of brokerage. We feel it is important to work with agents that think and act along those same lines.

English:
Consolidated Insured Benefits, Inc., offers whole life, indexed UL, term life and a complete suite of medical products.  It’s our opinion that whenever possible all life products sold should include living benefits, chronic condition and critical illness.  Life products sold with living benefits do not increase the cost of the coverage and allow for the death benefit to be accessed while the insured is living.  

Cohen:
We are seeing a trend towards the hybrid life with LTC or CI type riders. The trend is important as we are seeing a shift towards this marketplace. The challenge for the consumer and broker is information overload–there is a lot of product out there!      Many times a deeper analysis of your client is needed to get to the right suite of products. We have trained our brokerage consultants to work with brokers to help them understand the various suites of products and clear through the clutter.

Phillips:
Like most BGAs we offer life insurance.  It’s been a mainstay of ours for ages.  However, we’re probably more diverse in our “front-line” product offerings than many BGAs.   We also offer disability income products; long term care insurance; fixed annuities; and non-health insurance group products: life, STD, LTD, dental.   We’ve also started ramping up our efforts in the worksite life arena. 

When I was young in this business I took for granted that this was the “way things were” in BGA product offerings.   We’ve always offered more than just “cheap term and impaired risk” life products and I thought everyone in our space did.     The multiple product lines allow us to open doors that would remain locked if we were otherwise only a life agency.   We respect relationships that brokers might have with other agencies, but if a broker has a great relationship with another BGA for life products, that’s fine–use us for fixed annuities or DI. Just like a consumer might do the bulk of his grocery shopping at one supermarket, but just loves the corner bakery–we’re fine with a broker getting his French pastries through us while he gets his eggs and milk somewhere else so to speak. 

For those who want to use us as their “primary grocery store” we’ve got the milk and eggs, as well as those French pastries, a great butcher shop, and the freshest produce.  The proverbial “one stop shop” at play.

Likewise, in some unexplainable way it seems there’s a buoyancy to our revenues–if one product line starts to stumble, we’ve seemingly always experienced the dynamic that another fills in that drop off.  And, overall, we’ve been fortunate that  our diversity has led to slow but steady topline growth.  

In a similar fashion I think that’s why a broker should not just be a “life insurance agent”–clients need to consider multiple insurance products and the people they refer an agent to might need a product beyond life insurance.   

Our model has adjusted to this very recognition–not only by life insurance agents, but by benefits producers, property-casualty agents, and investment advisors.   They are looking for education, training and often outright partnership or point-of-sale help in lines outside of their area of comfort.  We are there as a credible and trusted source to help expand their practice beyond their core business and diversify their revenue stream. 

Carlson:
The collection of products we offer is intended to encourage agents to protect their clients beyond the scope of life insurance. Our fundamental product lines include individual life insurance, long term care, disability income, critical illness and annuities. To accompany life insurance coverage, we offer long term care and critical illness riders. Pensions and life settlements are also available.

Our group product line includes life insurance / AD&D, dental, vision, long term disability and short term disability.

We recommend formulating a diverse portfolio of products to promote security for all stages of life; to help cover unexpected accidents or illness, to be prepared with income for retirement, and to support loved ones in the event of death. By doing so, not only will agents provide a more secure future for their clients, they also strengthen their relationship with them.

Much of the traditional training and education of agents has either evaporated or shifted.  What does your agency do to fill this gap and where would you steer agents to find necessary training and education?

English:
At CIB, Inc., we offer extensive concept training.  Concept selling is a much better platform to communicate with potential clients.  Selling from the concept platform allows clients to see life insurance as a solution rather than as a product.  If you ask 10 people if they want to buy life insurance, nine will say no.  One will say yes because he is about to need it.  Selling from a concept like tax-free retirement or college planning allows clients to view the benefits and rewards of the life insurance contract as positives and not view life insurance from the stereotypical negative perspective.

Cohen:
Brokers need to take the time to expand their education and knowledge of not only the products, but the underwriting programs and the advanced technology that is available in the marketplace. There is “product” and then there is “process.” Today’s modern insurance broker needs to understand both to move ahead. There may be very little difference in product and a huge difference in process–and that edge can win you a case. Then again, you don’t want to sacrifice products of better value for just an easier process. There’s a fine line and our brokerage consultants are trained to help brokers identify both areas. We teach and run programs daily.  We are very consumer driven and attract brokers that are like minded.

Phillips:
We offer many educational opportunities for agents and brokers.  We market many carrier or marketing group webinars and presentations.  We direct brokers digitally to the endless array of training resources on carrier websites and industry websites. But we’ve taken more of a back-to-the-future approach after feeling many of these methods have fallen short:  we see brokers.  We call brokers.  We have face-to-face meetings and workshops with brokers to provide information, product training and education.  

There’s a manic chase for the millennials in our space–and every consumer space that’s out there.  I get it.   But I think too often an agency or broker assumes that their  current constituents are those that will consume the trendy opportunities that are out there.   We’re constantly bombarded by the fact that the average age of an independent producer is in his/her 50s.   We can bemoan the fact that our future is bleak and we can wring our hands that the industry is not reaching younger consumers, but while we’re angsting away, we’ve got to make a living.  We need to provide training and educational opportunities to the constituents who are here right now.  

While those 50-somethings (like me!) have come light years in their understanding and grasp of digital opportunities, for the time being the old fashioned way is the way most want to be interacted with in my opinion.  Don’t get me wrong, even the most primitive of agent or consumer is “jiggy” with current technology and it is a fact that more and more education and training is moving to a digital platform.   It will, someday, be all-digital, all-the-time.  But for now, I think the time tested methods of educating, training and marketing to an agent, or them marketing to a consumer, hold true.  

Plowing through with accepted methods to one’s constituents while laying the groundwork, understanding systems and knowledge is the trick.   I think we’re doing a good job with that. 

Carlson:
While we continue to organize webinars and seminars for agents to learn about specific products or processes, our emphasis is on a personal, hands-on approach. Whether over the phone or face-to-face, we consistently coach them every step of the way. We recommend prospecting methods and provide customized materials, teach them sales ideas and how to recognize cross-selling opportunities, walk them through contracting and application processes, and hold their hand through underwriting. At the core, we provide a complete backroom support system.

Question: What is your view of the state of the disability income protection market today?

Cohen: The need for this product is tremendous. There are so many people who are not protecting their income. It would certainly be advantageous if we had more companies manufacturing this important product-that is where there is a shortage. The market is wide open and our job is to get more financial advisors to offer this product.

 I went to a wedding recently and was talking to another guest. He asked me what I did for a living. I told him I was in the insurance business and my main job is working with financial advisors getting them to offer disability income protection to their clients.

 He proceeded to tell me his story. He said, “Your product is extremely important. When I was 26, I began my dental practice. At 31, I asked a friend if he knew anybody who could offer me disability income protection as no one had ever called me about this product. At 32, I sought out and bought my first policy for $5000/month with benefits to age 65. At 51 I sought out an agent and bought additional income protection for another  $5000/month. At 53, I was driving home and noticed that the vision in my left eye was impaired. I found out I had Central Retinal Vein Occlusion in my left eye. My vision became so badly impaired that I was forced out of my dental practice. I began a new career teaching. While I was getting a teaching salary, my disability income protection policies were paying me $10,000/month because I was insured in my occupation of dentistry.”

When we talk about the state of the industry I find it amazing that this dentist  had to seek out an agent in order to buy disability income protection. He should have been approached by his life agent or casualty  agent.

When it comes to your most important asset—your ability to earn an income—and your ability to protect that asset, there is a drastic shortage of individuals who are educating consumers about this product.

On DI Day in May 2016, we had over 95 financial advisors attending our event. We also had a speaker—an individual who did not check the box for disability income protection. He proceeded to tell us his story about the most tragic mistake he made, and how his mission is to keep others from making the same one he did.

 Periodically, I go to the website (lifehappens.org) to read the Real Life Stories about the individuals that disability income protection has helped. I encourage everyone to go read these stories and to see just how important and crucial this product really is.

I believe the industry is making great strides. I foresee more manufacturers getting into the market for disability income protection.

Bloch: The state of the industry is fine.  The remaining carriers writing disability income protection have been adjusting rates, products, underwriting techniques, and systems to enhance results.  The carriers are working hard to increase market share and making it easier for the targeted consumer to purchase this important coverage.  I am surprised, however, that additional carriers have not entered the market with new exciting products.  The industry needs a new bold approach with basic benefits at affordable rates with a streamlined underwriting process to attract new policyholders who cannot appreciate or afford today’s high quality products.  

Chittenden: It remains an under-penetrated market, yet remains as vital to the financial well-being of every working person as it always has been.  Those of us in this market have been screaming, promoting, teaching, pleading and explaining this fact for years.  Resistance from many financial advisors, as well as traditional insurance agents, to embrace the income protection products, however, seems to remain fairly strong.  This is a double-edged sword.  Because of this lack of penetration, consumers are hurt.  They are not made aware of the need or the solution to protect their income.  On the other side of that sword, those brokers that do promote income protection products have a fairly untapped market.  The problem is not availability of product.  Even with the recent exit of a leading major carrier from the individual market, there is still a plethora of very good products available from excellent carriers to meet both the individual and business income protection needs.  The under-penetration comes from the lack of client education and promotion on the part of the advisor community.   

Phillips: I’m confused and concerned by this market but also very optimistic.  

With the recent departure from IDI by a major carrier in the white collar space, there are  a very limited number of carriers who distribute their product through independent brokerage agencies. And, like IDI’s sister product long term care insurance, there just don’t seem to be many carriers clamoring to get into this space.   This confuses me, as the little information I get on returns on investment for IDI seem to be solid for insurance companies.   Maybe my perception is wrong on that.   

We are in an environment where it is costly for carriers to put business on the books, and carriers must maintain their inforce blocks that were priced and underwritten in a totally different market environment.  I think we underestimate the herculean effort it must take these carriers to juggle this dynamic.  

So we have very few outlets for white collar business, we’ve got a tenuous market environment, and yet there is still excitement in the DI business.  Product enhancements, technological advancements and marketing programs still abound.  Almost daily I’m presented with an exciting case or opportunity.   It’s like some sort of paradox.  

Also, it seems that more producers and planners are looking to expand efforts into the IDI market.    I suppose that’s a function of the likely regulatory changes in the  investment and annuity markets,  as well as the changes that have occurred in the health insurance business.     While it’s a little disappointing that it has taken upheaval for this product that is so fundamentally important to a client’s financial well-being to be brought up as part of the conversation, it’s apparent that it is being brought up more and more.  That has to be a good thing for the market over the long run.  

Petersen: The market for disability insurance is the most robust we have seen in well over a decade. Yes, MetLife stepped out of the individual disability markets, but that should have little impact on the market as a whole. The key players are still in there. There has become more awareness of GSI plans which are being used as primary as well as secondary and excess disability coverages.

Bottom line is there are more opportunities in the Disability market than ever.

Schnittker: The marketplace is better than it has ever been with so many income protection solutions—key man, business loan completion, retirement completion, one person buy-out, and student loan, in addition to the traditional personal disability, business overhead expense and buy/sell.  Great time to be in this marketplace.

Mohr: We are very pleased with our disability insurance sales production this year. Disability sales continue to be a big part of our overall sales and revenue. Retirement planning products are certainly increasing in popularity due to the baby boomers, but there will always be a huge population of working professionals and business owners that need income protection. Most insurance agents just still do not realize the importance of selling disability insurance and the impact on their income both first year and renewals. Disability insurance is not just critical for their client’s financial security, but for the agent as well. What financial planner can say he did a financial plan for a client if he did not guarantee his client an income whether they can work or not?  

Some consumers think that they are covered at work. We train our producers to advise these prospects properly by telling them that most employer plans only provide about 50 percent of what you are eligible for, so you have half a plan through work. That is great, because now you just need to buy the other half! 

The market has never been better for disability insurance sales. There are plenty of great products and underwriting programs. Whether selling to individuals or executive groups, pricing, discounts and underwriting are all aggressive. 

Schmitz: There are fewer advisors being trained by carriers, so financial education is not happening like it used to. High schools should be requiring at least a rudimentary level of financial education and include the concept of insurance in the curriculum.

The market needs more carriers, and Met Life leaving was a big blow, but not a nail. There is a huge number of self-employed people and small businesses that have not pursued protection for their largest asset. The number of employers hiring employees at 30 hours per week so that they are not required to offer benefits continues to increase. Getting the word out that disability insurance exists is our challenge. 

Carriers offer more flexibility in underwriting, including guarantee issue individual policies for small groups. Home offices are genuinely proactive in seeking information from the field to take back and develop new products and processes.

Question: What advice do you have for brokers who don’t spend much time pursuing DI sales to their clients? 

Cohen: Roger Sweeney spoke at my agency’s DI day in May, 2016. He said the biggest mistake of his life was not checking the box for DI protection when the corporation he worked for offered it to him.  He is a young man and is  disabled due to  a series of severe health issues .  He stated, “I was the All-American guy.  Perfect job, beautiful family, great income and then it was all gone.”

My advice is for every broker to know Roger Sweeney’s story and to take the time to read Real Life Stories at www.lifehappens.org. 

Once a broker understands how DI protection can save a person’s financial life, that broker should never feel that he does not have the time to pursue a DI sale.

My advice to financial advisors, agents and brokers: You have the responsibility of being entrusted with your clients well being.  You must explain the need for disability income protection. As you read Real Life Stories, you will become aware of the thorough and responsible job brokers did for their clients.  

Bloch: My advice to producers who are reluctant to discuss income protection with their clients is to pursue a partnership or other relationship with another producer who specializes in income protection insurance.  We have a number of producers who realize the importance of this coverage and split cases with income protection experts.  Their clients truly appreciate their professionalism.  On larger or more complicated situations, our agency is asked to develop strategies and implement them. 

Chittenden: Make sure they have a strong E&O policy.  It has always amazed me that brokers will spend all the time and effort to build an amazing financial plan to meet the hearts and dreams of their clients.  They will make sure retirement is funded.  College education for the kids is funded.  Maybe the dream vacation home or the travel dreamed about is funded.  For sure they address the catastrophe an early and unexpected death might cause.  But, they refuse to address the risk their client faces if their ability to fund the entire plan is interrupted by an illness or injury that prevents them from continuing to work and earn a paycheck.  Some brokers have a million excuses.  They don’t want to be a “policy peddler”, or there is only “so much” premium to go around.  They are worried a “complicated” IDI sale will ruin all their other sales, etc. All are simply invalid excuses.  To not evaluate the risk management part of the financial plan fully, meaning to protect the funds (income) that makes the complete plan work, is simply bordering on negligence.  My advice to all of our brokers not promoting income protection is to make sure their E&O plan is in place and strong, and that they very clearly inform their clients what services they do provide and which ones they do not provide.  If there are parts of the total financial plan they are not going to address then they should be identified, and an alternate avenue should be presented to get those aspects addressed.  Not many people can be proficient in all aspects of financial security but everybody can be part of a team that covers all the bases.

Phillips: My first piece of advice would be to make sure they understand their own situation and exposure for disability, and, if they don’t already own coverage or if it hasn’t been updated in years, to get an appropriate IDI policy for themselves.   Work with an agency that specializes in DI to really understand the differences in definitions and the many types of DI products that are available (ID, BOE, Loan DI, Retirement DI, etc.) as a consumer first, then take that knowledge to their own clients.    

I’d also simply announce to inforce clients that DI is now a product that they will be pursuing, and then “just do it”.   Ask inforce clients if they have DI coverage (they probably don’t).  If they have coverage , ask if they understand it (they probably won’t).  If they have had it for awhile ask if it’s been updated with their increased income (it probably hasn’t).  I’ve always been a proponent of learning by doing.   Do it by picking up the phone or meeting with a client and simply asking about their situation.

Petersen: There are several things:

To life and medical sales professionals who do not also promote disability insurance I have one thing to say—shame on you!

People are relying on us as professionals in the insurance industry to advise. If we spend our time saying things like “protect your assets”, “estate planning in case you die”, “business protection”, we better be including not just if you die—but if you live! Protecting your assets begins with income planning. You cannot have income planning without a program to protect the income. This is just as true if you live as if you die.

If we spend our time saying things like, “cover large bills from doctors and hospitals” we better be including some mechanism to cover all the bills, not just the hospital. People worry about medical insurance because they fear large bills from the hospital and doctors. Think about this: In most people’s lives, the largest purchase they ever make is their home. Do they have $500,000, $1 million or more to buy a house outright? Not usually. However, thanks to a mortgage, they can make payments. The caveat in all of this is that they have some sort of cash flow that allows them the ability to pay these big bills and big debts. If a person did not have medical insurance and the bill was $1 million, they could still pay it provided there was some source of cash flow.

Professional insurance producers who neglect disability sales when they actively sell life and/or medical insurance are not helping their client 100 percent. Could this be considered malpractice?

From a personal perspective, these producers are leaving thousands of dollars of commissions on the table.

Lastly, they are setting themselves up for another producer to take over the case and do a better “full service” approach.

Schnittker: You owe it to your client to at least ask them what would happen to them if they became sick or hurt and could not work.  There are numerous income protection specialists that a broker can affiliate with to provide the best solutions for their client’s needs/wants.

Mohr: Pretty simple—you are missing the boat or should I say yacht!

Schmitz: Be careful. Fiduciary liability/responsibility is a hot topic. You must address the issue of income protection within the financial plan or risk management plan. If you are not comfortable addressing the income or asset protection need, find someone to work with who can help you without disrupting the relationship you have developed with the client. Several MGAs now offer “in house” experts who are able to work directly with your client and pay you a referral fee.

Question: How have hybrid/combo products affected the income protection market? 

Cohen: From my observation hybrid/combo products have not affected the disability market.  An individual policy is more comprehensive and will do a better job protecting one’s income.

Bloch: Over the past five or so years, our agency has developed a number of income protection specialty products to solve unique situations for producers who work with our agency.  A couple have had mixed results and others have generated incredible enthusiasm and sales.  I do feel that the the income protection industry will be changed as we target unique specialty solutions, consumers, and other industry professionals. 

Chittenden: I do not see much impact within our market, unlike the LTCI market where the Life/LTC or even the annuity/LTC products have made a big impact.  For the most part, the advancement in the products in the income protection marketplace have focused on improvements for meeting evolving societal needs—such as older issue ages and riders for student loans—or product design to allow maximum flexibility. 

Phillips: In my experience, I have not seen much impact of hybrid products on the income protection market.  But we’re just at the start of this evolutionary use of death benefits helping address living needs.    At one time, acceleration of death benefit was limited to a terminal illness situation.  Recently carriers have expanded into access being granted for chronic illness/long term care situations.    More recently there has been liberalization to allow access for critical illness situations.   It certainly seems that the natural progression might lead to accessibility due to a disability (that might not be because of a chronic or critical illness).   

I’m not sure how the market would accept such a structure.   It seems to me that the acceptance of the ubiquitous chronic illness/LTC design is as much a result of the tumult in the long term care insurance markets as anything else.   

And while critical illness sales are on the upswing, it is not a mature market—there haven’t been generations of planners dedicated to the sale of CI.   There aren’t as many firms with roots as deep in the critical illness market as in the DI market, so it seems that acceptance of CI as a linked benefit opportunity might have less of a barrier than a DI design might.  

Call me old fashioned,  I can rationalize the linked benefit design as a strategy in some long term care planning situations or as a way to get something for critical illness exposure.   But the risk of death, the risk of long term care need and the risk of disability are three entirely different exposures.    In a perfect world, insurance to address these with individual products specific to those risks would be  most efficient.   Especially, it seems to me, the risk of losing one’s ability to earn a paycheck.

Petersen: We haven’t noticed any significant changes. Ultimately combos, like GSI, may just help the sales and underwriting process.

Schnittker: We have not seen much affect.  There are products like critical illness which are excellent supplements to income protection that can be really beneficial for the client, and can make your broker’s recommendation to his client more meaningful. 

Mohr: Most hybrid products have to do with Life and LTC combination coverages. I do not see where these impact disability insurance sales at all.

Schmitz: I would like to see a hybrid/combo product that includes DI. I would like to see a simplified issue hybrid CI/Accident-Only DI with cash value to market to millennials.

I’ve been expecting an explosion in Critical Illness Insurance premiums since I first became aware of the product sometime in the late 1990s.   For many years production floundered.   However, that dynamic appears to be over.  According to the Critical Illness Planning website, www.criticalillnessplanning.com, premiums increased five-fold from 2008 to 2013.  That’s a phenomenal statistic that is especially powerful given the lackluster premiums in other fixed insurance products over that same time period. 

More employers are offering this benefit on a group chassis or on a voluntary payroll deduction basis.   The individual markets seem poised to grow as the realities of the self-funding elements of national healthcare sink into the fabric of our society.  Simply, all signs point to this being a market that will continue onward and upward, and dare I say, might someday be as much a part of an overall insurance planning discussion as life insurance, disability income insurance or long term care insurance is today.   It’s time to become familiar with this coverage in anticipation of offering this to one’s practice, or preparing for the inevitable questions from consumers as the coverage takes more of a foothold with the public. 

Let’s consider some “good to know” items in this market:

It Wasn’t Spawned by an “Insurance Guy”
The whole idea behind this product came not from an astute insurance actuary or investment guru, rather it came from a physician with a very famous pedigree.   Dr. Marius Barnard, son of the famed South African heart transplant pioneer Dr. Christian Barnard, first thought of this coverage as a funding mechanism.  He was a renowned cardiac surgeon in his own right and he saw the financial hardship his patients endured after recovering from a critical illness. Thus, he lobbied South African insurers to develop this coverage.  

His noble and poignant stance was summed up in this quote that is found on the Insurance Hall of Fame website, www.insurancehalloffame.org/mariusbarnard, “I was used to operating on people and boasting about my great results of patients surviving five or six years. But all of sudden I saw the social and financial implications. I knew nothing about insurance but I knew life insurance paid out on the diagnosis of death. But to me, my patients lived for years but in this time they died financially.”  This remains the essence of this coverage – providing for those clients who have a critical illness event, but don’t die… which brings us to our next two bullet points. 

People Who Have a Critical Event Live!
Take a look around when you are in a public place and see how many Automatic Electric Defibrillators are available.  In many states it’s a law that schools, health clubs, swimming pools and many other public gathering places are required to have AEDs equipped and on the ready.  Trends in first aid, emergency response and overall medicine have led to some realities on those suffering coronary incidents as well as other critical illness events.   Some statistics that we all probably could have qualitatively grasped anyway: 

• 75 percent of people who suffer a heart attack survive at least three years, as provided by the Critical Illness Planning Website www.criticalillnessplanning.org.  

• Likewise the same website describes that more than 70 percent of stroke patients live that same amount of time. 

• Women have a 64 percent chance of surviving at least five years after a cancer diagnosis; Men have a 66 percent chance of surviving that time period per the American Association of Critical Illness Insurance.  

The list of statistics goes on and on. It’s very apparent, isn’t it?   But what is also a reality is that with these survival rates there is also a cost of recovery that is very often out of pocket.  

There are Real Out-of-Pocket Costs for Those Surviving a Chronic Illness.
There are a number of different insurances beyond just an insured’s savings that can go to offset the financial impact of a critical illness claim.  However, there are inefficiencies relative to what they will cover when a critical event leads to financial impact: 

• Health Insurance – Health insurance will cover the bulk of the medical care that will be provided to an insured, but it will often not cover it all.  Beyond the health insurance deductibles, there are often co-pays, costs for experimental procedures, or other treatments that won’t fall in the realm of traditional health coverages. 

• Disability Income Insurance – Disability Income Insurance proceeds are designed to address those ongoing ordinary living expenses that continue when one cannot work.   The costs that are incurred in a critical illness situation are often not “ordinary”.  They are above and beyond what a DI plan may be earmarked to provide.  

Likewise, DI plans have inability to work triggers as well as elimination periods.  Often a critical illness will occur where an elimination period isn’t completed or a loss of work does not occur. 

• Long Term Care Insurance – Like DI, there are typically elimination periods that need to be satisfied as well as triggers to ensure the client is “chronically ill”.  Very often in a situation of a critical illness, a person might be cared for and recovered before an elimination period is satisfied.   Or, a client may not qualify for the triggers at all.  

Wrap Up:  Critical Illness Insurance Realities and Other Ideas
Critical Illness insurance was conceived by a doctor with noble intent.  This is a story that proposed insureds need to know.  It’s a coverage that will help clients cover out-of-pocket costs upon diagnosis of such an illness or event.   It will pay without elimination periods, proof of inability to work, and without requiring a client maintain a dilapidated state for funds to be released.  

More and more employers are making this a part of their benefit offerings.   Major carriers are jumping into the fray offering critical illness coverage on a group and voluntary basis.  As the realities of national health care coverage and its shortfalls become more recognized, consumers are bound to ask more about this type of product and purchase it on an individual basis.   Production numbers imply that this dynamic is already in play.   

A prudent producer will get a sense of these product offerings and the differences between carriers.   In relatively short order critical illness could be a big part of a client’s overall insurance planning strategy. 

M. Susan Ondack, LUTCF
Disability Income Regional Vice-President, Principal Financial Group

Eugene Cohen
Eugene Cohen Insurance Agency, Inc.

Dale Chittenden
The Plus Group Arizona, The Chittenden Group

Thomas R. Petersen
Petersen International Underwriters

Raymond J. Phillips, Jr.
The Brokers Source, Ltd.

Patrick T. Jackson
The Plus Group, Income Replacement Agency

Q: What are some key attributes that you see in successful DI producers?

M. Susan Ondack: The biggest obstacle for agents selling DI is that they do not feel comfortable explaining the cost and benefits.  The agents successful in selling DI are those who put their client’s welfare in front of their own comfort.  They are producers who want to learn and be the best financial advisors they can be.  I find full financial planners and producers brought up in the career distribution system to be the most successful producers. 

Eugene Cohen: I have worked with hundreds of disability income producers during my fifty years plus in the insurance industry. I have found that the key attributes that the successful producers have are:  focus; concern for their clients; enthusiasm; quest for ongoing product knowledge; and resiliency. 

The successful disability producer is so focused that nothing can take him off track.  There is an internal mechanism that allows him to disregard distractions. The successful disability producer is always concerned about the needs of his client.  He is concerned that the clients have disability policies that fit their current needs.  With good record keeping the producers keep in touch with their clients and review coverage on an ongoing basis.  I see so much enthusiasm in successful disability producers. They get excited about their products because they have seen how the coverage has protected some of their clients when income protection was needed. Their coverage has helped families survive after a sickness or accident has removed the family’s paycheck.  The need generates enthusiasm. In any business you are in, Knowledge is Power.  Successful disability producers know this; they are always studying their products.

It is very important to our agency to facilitate the quest for knowledge.  We work with disability producers one on one and we hold workshops.  If a producer cannot come in, we will arrange a phone conference.  Our goal is to provide product knowledge as this is a key to being a successful disability producer.

It is a known fact that all successful disability producers will have rejections. Not every sales call will result in a sale.  Successful disability producers know this and when they are pushed back, they rebound forward.  They are resilient!

Dale Chittenden: Compassion, patience and the ability to see the big picture, along with a personal story to tell, are some of the key attributes.  It seems at times our lives are moving at lighting speed and we all want the immediate solution—instant gratification if you will.  Income protection, as vital to our financial health as it is, is anything but that.  Successful DI producers see that, understand that, and have spent the time to a) communicate this need to the client in multiple ways and then b) simplify and individualize the process.  They are willing to do their work upfront by doing the simple fact finding needed (income, health, job duties), setting realistic expectations for the client concerning the most likely outcome and then creating coverage that is tailored to and works for the client’s individual need and budget.  All too often I get requests to quote the max, adding every possible rider and benefit available.  Not everyone needs that or can afford that.  I spend a good amount of my time “downsizing” quotes and teaching producers that it is better for their client to have something than it is to scare the client away and they buy nothing. 

Thomas R. Petersen: Unafraid! I don’t mean that other producers are afraid, but many producers fear losing a life sale or a group sale if they discuss disability insurance. They think that the prospect will have overload on all the products, or, at the least, start mentally budgeting money away from the larger commissioned product.

The reality is that those who approach selling disability insurance by including it in their early discussions with prospects are often rewarded more by more sales as the prospect listens and understands that a loss of income can occur other than from death!

Raymond J. Phillips, Jr: One of the key factors I see in successful DI producers is they are organized and methodical in their approach to their clients and prospects.   Their approach to marketing to prospects is done in a strategic, consistent manner.  Indeed, often just getting a prospect to commit to sitting down to discuss DI planning is a great task in itself.  It requires consistent and timely follow up in order to get an appointment to make the client aware of the whole disability income insurance abstract. 

Successful DI producers are very knowledgeable and objective when comparing and presenting coverages.   For a proposed insured the jargon can get very confusing.  Within their skill set, successful DI producers have an ability to communicate often complex, confusing coverage descriptions into concise, understandable descriptions.

Their organization skills continue well beyond the sale. The successful producers I’ve run into understand that it is important to have consistent, timely communication with the client over the years.  As the policy remains in force an agent should help a client navigate future purchase options or adjust coverages as occupations and incomes change.  Very often this engagement leads to new sales with their existing clients and/or referrals to new DI purchasers.  

Patrick T. Jackson: Successful DI producers should possess several important characteristics.  To me, the beginning point is that producers need to have both integrity and honesty coupled with a deep personal belief about the daunting financial risks that each of their clients face.  A caring and compassionate producer should endeavor to insure that all of his clients cover the risk of a disabling event and they should ideally own their own income protection plan. A producer should consider the complete financial picture of each of their clients’ needs to be able to articulate the potential risk as well as the pennies on the dollar solution to that risk.

Q: What role do you think industry organizations should play in motivating brokers to strive to provide DI to the majority of their clients and what can be done to get industry organizations more involved?

Steven L. Brady, The Standard

Michael Cohen, Eugene Cohen Insurance Agency, Inc.

George G. Davidson, Secura Consultants

Craig Gussin, Auerbach & Gussin Insurance and Financial Services, Inc.

Keith Hoffman, NFP

Maureen A. Kirschhofer, Doc-DI.com

Thomas R. Petersen, Petersen International Underwriters

Raymond J. Phillips, Jr., The Brokers Source, Ltd.

Q: What are some important agent best practices for selling DI?

Steven Brady: Agent best practices would include frequency of applications. We did a study on agents who write at least five applications a year. The actuaries found that the morbidity was much lower on agents/brokers who did at least five a year. I think the reason is that frequency creates confidence. Confidence is needed in placing a case that has a rating and exclusion and possibly limitations. Confidence also allows an agent/broker to seek out potential clients instead of waiting and being asked about disability. Many will say selling skills or underwriting thoroughness or even target market depth, but I think frequency is the best skill…just go out and do it.

Michael Cohen: Brokers have to ask their clients before the client asks them. Once that occurs, they may not be able to obtain the coverage! There are some great opening questions to ask a client, but starting with a disability insurance inventory is one way to open the conversation. Having an assistant or yourself gather the current disability coverage allows for the conversation. Most individuals do not know what they own or the details of the policies. Better yet, most policies haven’t been updated for their current needs. More times than not you’ll find that there is no disability coverage at all, which paves the way to more targeted questions and real planning.

George Davidson: Don’t make the decision for your client.

Producers make the “buying decision” for their clients without even asking them. We see this repeatedly. “My client doesn’t need this coverage. She has a group plan at work and that is sufficient.” The producer attitude closes down the client’s opportunity to protect her family and/or business. Establish a process that ensures that each client has the opportunity to vote.

Craig Gussin: Agents have to mention and ask every one of their clients to buy DI for many reasons: 1) If you don’t, some other agent will, and then your client has two insurance agents instead of just you. 2) Based on statistics, 25 percent or more of your clients will become disabled. If your client becomes disabled and asks you why he did not have DI, what are you going to say? How is he going to pay his bills? 3) You can increase your income greatly without much work-your clients like and trust you already and will buy DI if you educate them on the need.

Be sure you understand the different DI products and the benefits the different insurance companies will offer a person based on his occupation and income. Not all DI products are the same!

Keith Hoffman: Prospecting, DI storytelling and the consultative approach.

Maureen Kirschhofer: I believe that it is really important to sell the need rather than the features when first meeting with a client. Disability insurance is probably the most important insurance that clients can purchase. When you look at the statistics, it is shocking to see the number of individuals who will become disabled for more than 90 days before age 65. I tell my clients that if they love someone, they buy life insurance; if they love themselves, they buy disability insurance. After working for one company for many years, I really appreciate that I can present more than one option and company to my clients. That way it becomes their decision, not mine. When my clients have a claim, I will be there for them, helping them to complete forms and assuring them that the piece of paper they purchased from me is a contract that will pay them when they are sick or injured and can’t work. It is the “you never know” time of their lives. A disability is difficult, but when the bills come and don’t get paid, it is even worse.

My present clients are quick to offer referrals to me, and that makes me feel that I have done the best job that I can for them. I feel like I am a specialist. I am the cardiologist of the insurance market. I don’t try to be everything to every client, but I make suggestions to help them with their planning by working with other specialists whom I feel will do the best for them

Thomas Petersen: Set reasonable expectations and don’t oversell! There is a difference between explaining what disability insurance is designed to do and promising what a specific carrier will do. Expectations get high about the process during underwriting and claim time.

Ray Phillips: First and foremost, know what you’re selling. While there is a certain amount of complexity in knowing product definitions, for the most part it’s my experience that carriers make their policy provisions understandable and accessible. Agents owe it to their clients to know what constitutes a claim. I’m convinced that many do not review the coverage with their clients in an elevated manner. The fact is that income fuels all other insurance planning and investment planning. I’m not sure that this reality is expressed enthusiastically to the prospective DI consumer.

Future purchase option (FPO) riders are a must-sell to those who can qualify. Fact is, clients’ incomes do go up over time in just about every occupation. FPOs provide an efficient way for policy benefits to track with the increased exposure. While a person’s health may not deteriorate over time, the ease of accessing higher benefits is very appealing.

Hand-in-hand with that, when selling DI I think the agent should continue to communicate with the client consistently after the sale. Having a DI policy in force always provides an opportunity for a conversation. That conversation will allow for a review of policy provisions, an opportunity to adjust coverage to a client’s current situation (higher income, different job duties, etc.) or to provide suggestions on other coverages the agent can offer.

Q: Where should agents go for a) basic DI training, and b) continuing or advanced DI education?

Cohen: We find that this is really an apprentice type of business. Working with those agents and BGAs who have been selling disability insurance for decades is really the place to learn. The International DI Society is a great association that allows agents to dive deeper into disability insurance. In addition, The Plus Group is a nice source of regional BGAs around the country who provide training and education to agents.

Davidson: The Plus Group! If your “product source” isn’t your “information source,” then find a new partner. However, if you are serious about sales, you need to employ a sales strategy I learned from one of our carrier partners years ago: ask to get. Ask for training and you will likely get it!

Gussin: As an agent you should learn about DI from taking courses offered by AHIP, IDIS and other organizations such as NAHU and NAIFA, along with working with reps from DI companies. DI reps love to teach you and go on appointments with you, and they will help you make the sale. To get continuing or advanced DI education, join IDIS, the only organization solely geared toward DI.

Hoffman: There’s a distinct difference between product training and sales training. So I’d say product training can best be learned from BGAs and carrier wholesalers. Sales training from senior producers, senior BGAs and senior wholesalers. As an example, Impel Dynamic offer sales training services that can really help someone learn the ropes, but there’s nothing better than doing it on the job, because the “frequency of fatal accidents” diminishes with experience.

Kirschhofer: I was fortunate to work for a company that specialized in disability insurance. They had wonderful training both in my agency and at the home office. We met for some new agent training after about six months in the business, and I believe that this was the wood that kindled my fire to become a DI expert. Unfortunately, so many companies have dropped selling DI or don’t focus on it because it does not profit them, so agents need to go elsewhere for their training. I would recommend that they find out who is the best in DI in their area and take them to lunch and personally ask if they would mind mentoring them. I have worked with several agents in the Jacksonville area just because they asked. Nothing is more meaningful than seeing someone in action on a sales call. The International DI Society offers monthly educational seminars, and I would highly encourage any agents who want to sell more DI to try one of them. One is open for free, and then membership in the society is necessary to continue. The association has worked hard to establish an advanced disability designation in conjunction with AHIP. Here again, I would encourage anyone interested to go to the website, www.internationaldisociety.com, and check it out.

Petersen: In general, the best training still comes from the brokerage outlets, as they have a variety of carriers so they can advise on each case a producer comes across.

Unfortunately, most carriers do not train people to sell disability insurance. Many believe they do, but what they often teach is product knowledge, not sales or general disability education. Thus, most training is left to brokerage, to online sources, and through organizations such as the International DI Society.

Phillips: At the risk of sounding self-serving, an agent’s local BGA is usually a wealth of training and education. Likewise, many of the carriers provide wonderful training modules on their websites and have local/regional brokerage reps of their own to support their products.

Life Happens has a wonderful DI suite on their website, www.lifehappens.org. The Council for Disability Awareness also has great background information and abstracts on their site, www.disabilitycanhappen.org.

For advanced education, the International DI Society has partnered with AHIP for the following designations: Disability Insurance Fellow (DIF) and Disability Insurance Associate (DIA).

Brady: I think that training is the most evident problem with our industry today. The time was that with many carriers providing disability insurance, and many brokerage companies competing for business, we wrote the most we have written as an industry because we had the most training available at that time. Now, one must go to LUTC for DI training, and to the local independent DI wholesaler. We are fortunate to have independent wholesalers who believe in disability insurance and provide training on all levels, even on case help.

Q: What are some effective ways “non-DI” aents can partner with DI experts?

Davidson: Outsourcing has been a catch phrase in business for years now, and many times it has a negative connotation. The reality is that partnering with a product specialist is the best way to jump start your practice. Ask  in your network for a referral and visit with a product expert to make sure you both have the same business values. Develop a simple agreement on process and compensation, then “pick five!” The “pick five” is a great way to “date before you get married.” Identify five existing clients who exhibit the characteristics of a DI purchaser.

 • Between 30 and 55 years old.

 • Self-employed or employed with their current employer for more than two years, and earning $75,000 or more.

 • Children still in the home or in school.

 • Client is a “planner” and exhibits this characteristic in prior transactions.

 Now plan the outreach with your partner (introductory note and phone call) and start the process!

Gussin: Meet agents who sell DI at your local NAHU or NAIFA association meetings and discuss partnership with them. Also talk with some of the DI reps and ask them to help you find an agent who is an expert in DI. They will recommend a DI agent they know will be a good fit for you.

Hoffman: The most effective way is to go with an expert on many joint calls.

Kirschhofer: I briefly mentioned this before, but I treasure my relationship with my DI partner. We each have various strengths that we share with each other. We were competitors who met and instead of competing for clients became a company focused on working together with them. In many ways it had taken awhile to get into the market that we have, but it really works. While I love to review contract language with our clients and do educational seminars, Judi is great at focusing on marketing to them on a persistent basis.

Petersen: Just ask! However, most people won’t for fear of someone stealing a client. The reality is that many good DI producers would love to share a sale and help everyone.

Phillips: The agent needs to decide how much he wants to become involved with the DI sale. Does the broker want to present the product, or serve as a facilitator to the client’s consideration of DI?

As mentioned earlier, there are a number of local, state and national opportunities for an agent to get to know and understand the market. An agent can partner with a carrier brokerage rep or BGA to become educated on the presentation of the concept. Most often the carrier brokerage rep or BGA will assist in point-of-sale presentations to allow the agent to get comfortable in the process. Often this is done without concern for any commission split.

In each market there are other agents who specialize in the DI sale. They work with agents who do not want to become involved with the specifics of a DI sale, but rather are looking to “farm out” that business. Those cases are typically done on a commission split basis. Where can they be found? I’d suggest the local NAHU or NAIFA meetings, or even by referral from the company brokerage rep or local BGA.

Brady: The key is “partner.” Corey Anderson is a great example of a true partner. He works with agents who have the relationship with the client but no interest in becoming a DI expert. So they contact Anderson and he splits the case with them. I think that is the future. With disability insurance being so contractual-language-driven and so competitive, it takes an expert to see beyond price and get it through underwriting as sold.

Cohen: Anyone who has clients should be asking some of the basic DI questions. Disability insurance is easy to learn when you have the right teachers. Each broker can become an expert in this marketplace with a little help and direction.

Q: How are today’s products different? What’s good today, what would you like to see, and what do you wish would come back?

Gussin: DI products have changed over the past 20 years. For example, they would pay your client for life if he became disabled, but now they pay only to age 67. The one thing that has not changed is that if he becomes disabled he will receive a tax-free check until age 67. I believe the plans today are as good as or better than before. Just be sure you understand the product you are presenting to your clients based on their occupation and income.

Hoffman: The basic guts of the policy have not really changed. Sure, there are tweaks which have always created the “leapfrogging” that carriers enjoy, but there is nothing really new. “You get a benefit if you are too sick or hurt to work!” I really wish more life insurance carriers would focus their messages on total risk management for planning and not just promote life insurance for income replacement.

Kirschhofer: I guess that I have been in the business long enough to see a complete turnaround from the 1980s. When I began, companies were competing with one another for best cost, benefits and sales. Suddenly at claim time, they realized they had given away the store. Benefits were withdrawn, prices changed, and many companies are no longer in the business. Now, with more rational underwriting and rates, the companies are offering many of the same original benefits. I loved selling return of premium to my clients and wish we had more options to do this in my state. I had one client who remodeled her kitchen when her 10-year return of premium was up. It makes clients feel that they can achieve a benefit without being disabled. We need to convince our state insurance departments to realize that this is a great benefit and one that would be great to return. If you show potential clients a competitive rate of return on the extra premium, it works even better.

Petersen: Products today are nearly as good as they were in the “heyday.” Limits are up, definitions are excellent, provisions are broad, and access to group, individual, multi-life, excess and business coverages have never been greater. Underwriting is faster than ever, too.

There are some products that producers who have been in the disability industry for many years may miss, but some of these items cannot come back, at least in their original form, due either to regulatory or financial reasons. Case in point is return of premium. There are a couple of carriers that still offer this in some form or another, and my hat is off to them. However, most carriers will stay away from this due to the financial loading and reserving it requires. Another provision is the “lifetime” benefit. The concern for “over insurance” is not just the benefit amount that could create a possible malingering, but also having cash flow for the rest of a person’s life. While it still may have its opponents and proponents because of these theories, the fact is that this benefit might not resurface for some time. I do note that maximum benefit periods are creeping up, though!

Many carriers have been increasing their maximum benefits. This is true for personal disability plans as well as business plans. Fortunately for us, there are still many income producers as well as businesses and business deals which require higher amounts for protection than what most carriers will insure. Even within our business of excess coverages, we have seen new product designs that have been generated to meet the demands for these situations and to fill in gaps.

Historically, for example, excess coverage plans were limited to a maximum of five years benefit. Today we have benefits that can be paid up to age 70! This came as a response to the need for programs that better overlap traditional disability plans.

Key person disability planning is another area that has been changing. While there are a couple of traditional carriers that write key person, the benefits they offer currently are relatively low and only for a select group. Every business has a key person, and sometimes they are high income people such as the rainmakers of a law firm or a top executive, and other times they may be technicians who keep the business flowing.

So how do insurance professionals get training for these things? For the most part, selling supplemental or excess disability plans is similar to selling the base underlying plan since, in a perfect world, excess plans are just an extension of the base coverage. This is where product knowledge comes in. There are some differences in the product, but not the sales technique.

I refer back to another comment I made that what producers need to do is keep the discussion, at least initially, on what disability insurance does (regardless if it is personal, business, group, excess, etc.). Once the sales process goes beyond the expression of interest, then specific products should be discussed regarding how they work.

Phillips: Today’s products have many of the traditional definitions that made the DI market viable and substantial years ago. Specialty own-occ coverage is very available. Many carriers have residual definitions as good as or better than they have ever been. I’m not sure there has ever been a time when definitions have provided more robust coverage opportunities than at present.

I am a big fan of the old return of premium rider structure, and I would love to see that rider return in an affordable form. I’m not sure that with interest rates having been in the doldrums for so long-and apparently going nowhere anytime soon-there will be any innovations in that department.

With national health care a reality, I would also like to see more carriers offering the old “nondisabling injury benefit” or accident coverage in their plans. This allows for a sum to be paid out if a client is injured in an accident but not disabled-a sprained ankle, a separated shoulder, a twisted knee, etc. Such coverage can provide dollars to offset deductibles that might end up as dominant factors in the health insurance structure as we go forward. Plus it gives the client a very realistic view of a positive that the coverage can offer.

Brady: Products seem very similar to the best we had to offer in 1980-1985. I think products and underwriting have remained unchanged. GSI is a different animal, and certainly the future of DI growth for most companies. I would like to see a whole life version of disability insurance built and offered to new markets that currently do not purchase disability insurance.

Cohen: The need is there and should be covered. To preserve space, I can’t go into the products and features we would like to see. It’s important in today’s world to train brokers on how to ask and develop the need for this product. Once there is the need, there are resources that can  help review and educate the broker.

Davidson: This is the best time to be in this business! Premiums are lower than they have been in years. Carriers are offering programs to help with  multi-life and business owners. There is more capacity and better underwriting. Demographics are swaying in our favor, with the largest buying group ever about to hit the prime DI buying years. Position yourself now as the go-to person for income protection and you will reap the rewards for years to come.

Q: In LTCI sales, one school of thought is to get at least some coverage in place, with a goal of striving for more coverage in the future. Does this approach lend itself to the DI market?

Hoffman: Agreed, but it is the approach that is incorrect. Many times, at the point of sale, the producer recommends a reduction in the benefit amount to “save premium.” The benefit should be the last choice to reduce premium. It makes more sense to tinker with the elimination period or the benefit period to save money. The reason is that once you’re disabled, it will be hard enough to live on 60 percent of your income. [KH]

Kirschhofer: If cost is a problem-and I tell my clients that they should look at about 3 to 6 percent of their income to protect that income-something is really better than nothing. If they have to decide between a shorter benefit period or a smaller indemnity, I would suggest a shorter benefit period. What I say, if this is an issue, is, “Close your eyes and picture yourself disabled.” Then decide what you really need in a product that will help you to continue in your world. A disability can be a living death, but we can make it tolerable by taking away the fear of living without an income. [MK]

Petersen: It seems to be a thought brought in by some and may have some merit, but the reality is that maximum benefits and benefit excess plan maximums are based upon an adequate amount of coverage, not an overabundance of coverage. Thus, if you get half of what you should have, you go broke only half as fast as without coverage.

LTCI is not designed to replace income in the purest sense, but to provide funds to pay for a specific type of expense. It is not there to cover household bills, mortgage, etc. [TP]

Phillips: I think this approach can and does work in the DI markets. While I am truly a proponent of protecting a client from that catastrophic, long term situation, often it can’t happen within a client’s budgetary constraints. Elimination of riders should be considered first, as far as allowing for the clients to afford something.

Lengthening elimination periods or shortening benefits periods can then be looked at if the client balks at a more comprehensive plan.

If the client cannot-or does not want to-afford a comprehensive DI plan, then something is better than nothing, in my opinion. [RP]

Brady: I think that idea is currently used with future purchase options and automatic increase riders, but to buy a small policy today and grow seems opposite of what most people want. They seem to want the most they can get now and not wait until later. [SB]

Cohen: The future purchase option is one of the most valuable parts of a disability insurance contract. These come in different shapes and sizes, but need to be positioned properly if a broker is going to have success in this marketplace.

The ability to make one’s product less expensive today so that clients can have some protection in force and, in the future, be allowed to apply for more without health questions is very productive and viable. [MC]

Davidson: Of course. Planning is never an “all or nothing” endeavor. Your client may not be able to save as much as he should, but he can start by saving a little and then it grows over time. Property/casualty customers may not have the highest limits, but they don’t go “naked” because of it. Income protection involves diversification (some coverage at work and some personally owned), and recognizing that you may not be able to have everything you want but you at least should have what you will absolutely need. [GD]

Gussin: Yes! I sell a lot of DI and add a future purchase option so clients can buy more DI in the future, regardless of their health. Get your clients some DI, and as their income goes up (and they can afford to pay more) you increase their DI coverage.  [CG]

Kenneth A. Bloch,  The Bloch Agency

Eugene Cohen, Eugene Cohen Insurance Agency, Inc.

George G. Davidson, Secura Consultants

Cindy V. Gentry, Life Happens and BBA Life Brokerage Agency

Barry Lundquist, Council for Disability Awareness

Thomas R. Petersen, Petersen International Underwriters

Thomas Petsche, Sr., International DI Society and Brokerage Solutions

Raymond J. Phillips, Jr., The Brokers Source, Ltd.

Q: What advice do you have for brokers on how to take advantage of Disability Insurance Awareness Month?

Eugene Cohen: The best kept insurance  secret is disability income protection. I ask myself, “Why?” It is such an important part of financial planning. Most advertisements for financial planning are geared toward income for retirement years, not taking into consideration that many individuals may be forced to retire before age 65 due to disabilities.

Brokers should take advantage of Disability Insurance Awareness Month (DIAM)by calling their policyholders and telling them that the month of May is DIAM, and follow that up by asking their clients questions such as:

 • “What is the longest vacation you have ever taken?” Most will respond, “Two or three weeks.” You ask why that is the longest and the response will usually be, “I have to work. Who can afford to take a longer vacation?”

 • “If you were to have an illness or accident and you were out of work two or three years, would you have an income problem?” If the answer is yes, you respond, “We have to talk.”

 • “Do you have a plan if, due to an illness or an accident, your income should stop?”

 • “Would you agree that your greatest asset is the ability to earn an income?”

It is my belief that if brokers asked their clients these questions, the clients would see the need for disability income protection.

George Davidson: While many organizations and carriers support the Disability Insurance Awareness Month initiative, it does not matter if financial professionals don’t embrace the concept, utilize the tools, and launch a campaign to reach their clients and prospects.

However, the first order of business should be a review of your own disability planning! As I was recently reminded, you sell what you own. Many financial professionals are woefully underinsured themselves, and you can’t preach the message if you don’t heed your own advice.

Cindy Gentry: The easiest way is to let someone else do the heavy lifting for you. Life Happens (formerly LIFE Foundation), which is the nonprofit organization that coordinates the national DIAM campaign each year, has free turnkey tools for brokers and agents to use during DIAM—and beyond. There is really nothing that you have to do from scratch. You can find the DI tools and resources at www.lifehappens.org/industry. (The sidebar gives you some concrete examples.)

Success with the campaign, however, lies in consistency. Plan ahead, choose the resources that you’d like to use, distribute them and then be sure to communicate about DIAM and DI on a consistent basis. In my business, besides a monthly newsletter, we also send out two weekly emails with sales ideas, marketing resources and product information. This consistent drip of information is invaluable. If you want them to sell it, they have to hear about it and know more about it.

Barry Lundquist: A broker’s responsibility is to help people protect what is most important to them. We know from research conducted by the Council for Disability Awareness that consumers, brokers and employers all agree that the ability to earn an income is a wage earner’s most valuable financial resource; income is what pays the bills, pays for housing, food, clothing, transportation and other living essentials, as well as giving breadwinners an opportunity to save for retirement, a new home, a child’s education, or just for a rainy day. Disability Insurance Awareness Month  gives a broker a reason to contact prospects and clients and start a conversation about the importance of income to their financial security, about the risk of income loss related to illness or injury, and about solutions that can help them protect that most valuable resource. It’s also a great time to remind those clients who have already purchased disability insurance how important it is and to suggest a checkup to make sure that the income protection they have remains appropriate. For those brokers who do not talk to clients about protecting their income, DIAM is a great reminder to them of what being a trusted advisor is all about. After all, their responsibility is to help people protect what is most valuable to them, and for most working Americans, nothing is more valuable than their income.

Tom Petersen: Disability Insurance Awareness Month is just as the name implies—awareness. Disability insurance does not sell itself like many other forms of insurance. It has to be sold. It is also difficult for the average person to picture himself disabled much beyond a cold or flu. DIAM does an enormous job of marketing and spreading awareness at both the consumer and industry professional levels. Groups such as CDA, Life Happens, and IDIS have great tools to help make marketing DI easier. But don’t start in May! Start in April! May is when the blitz to the public happens, and it is best to have all the resources going at once!

A side note: When May ends, the need for disability insurance doesn’t! Hopefully, insurance professionals recognize that DI can be sold, should be sold, and should be part of our everyday sales activities.

Thomas Petsche: We need to start ASAP getting emails, mailers and brochures sent out to brokers and clients just to get DI on their radar.

Ray Phillips: Invest in the tools available from Life Happens. Invest the time to know what is on their website. Invest the money in those marketing pieces that might help spread the word about disability income insurance.

Use the benchmark reminder of Disability Insurance Awareness Month as a reason to start a conversation with clients about DI.

For clients who have purchased DI, use this as a time for brief review of the client’s situation to confirm that benefit amounts are accurate; review the definitions and features of the plan so the client knows what he has and can expect if a claim arises. Provide a brief overview of the actual claims process—how to file, what happens, etc.—in case a claim does arise.

Q: What tools, process or technique do you recommend that brokers make use of to engage clients in a DI discussion?

Cohen: I recommend asking clients questions to engage them in the mindset of disability income protection. Ask them how important their earned income is to them. Ask them how they would fund their retirement plan if they were to become disabled. Ask a small business owner how he would pay his business expenses if he had a disability.

Selling disability income protection is easy when the need is established.

Davidson: The important news is that you don’t have to “reinvent the wheel.” There are ample materials provided by Life Happens and the Council for Disability Awareness. Take a few minutes to find the tools that fit your practice style and put them to use.

Gentry: Increasingly, one of the most effective means of connecting with people on a very personal level—especially with Gen Xers and Millennials—is through social media. None of us really seems to have the time necessary to devote to these new channels of communication, but the truth is that we ignore them at our business peril. Again, free resources from Life Happens can make it much easier. They have pre-written “compliance neutral” content about DI, including images and “info-statistics” that you can literally copy and paste to share. You can also follow them on the Life Happens social media channels, such as Facebook and Twitter, and simply share the new content that they post several times a day.

Lundquist: From knowing and observing hundreds of brokers over the years, I have tried to discern what differentiates those who are highly successful from the others. I have observed four traits common to the best of the best:

 • They are dedicated, lifelong learners. They never stop learning; never stop striving to be more educated and professional.

 • They are passionate. For them, selling is not about commissions, it’s about doing the very best job to protect their clients and best meet their most important needs.

 • They tell stories. They share stories from their personal and professional lives; stories from which, for many, their passion derives; stories about how important it is for people to protect themselves from the most catastrophic risks.

 • They ask great questions and then they shut up and listen. Clients don’t want to be sold, they want to be listened to, they want to be educated, and then they want to make their own decisions based on advice from someone they trust.

So I think the answers to this question are apparent from these four traits. There are no silver bullets. Clearly, being the best requires hard work. But those who dedicate themselves to learning, who are passionate, who have stories to share, and who have great questions to ask will be successful.

Some good questions to start a conversation about income protection include:

 1) If you were sick or injured and couldn’t work, how would you pay your bills?

Know what all the responses might be and have answers prepared. For example, if the person says, “We’d live on my spouse’s income,” what would your response be? What follow-up question would you ask? If the person said, “I have disability insurance,” that’s an opportunity to ask about their protection and to help them determine whether it is enough.

 2) What is your most valuable financial resource? What is it worth?

When they respond, they may talk about their home, their retirement nest egg, etc. Use the Earnable Income Quotient calculator, which is a great tool made available by the Council for Disability Awareness, to help them estimate the value of their income. It is typically a very large number, much larger than the value of their home or 401(k) balance.

 3) What are your odds of experiencing an illness or injury during your working career that will prevent you from earning a paycheck for three months or longer?

We know that most people dramatically underestimate their odds of becoming disabled. Use the CDA’s Personal Disability Quotient calculator to demonstrate that their risk is higher than they think. The good news? Solutions are available.

The key is to ask the question and then let the client talk

Petersen: There is no one way to engage someone. Some people are visual. Some are analytical and need statistical information. Some people empathize with stories, and others feel a need to protect their family or business. And finally, there is a group that buys because they are told they need it (usually by an attorney, friend, parent, business partner, etc.). As a professional salesperson (it doesn’t matter if you sell insurance, refrigerators or widgets), you need to be able to engage people on their level. Do you have a story to share? Do you have statistics? Do you have pictures? If not, get them! Life Happens, CDA and IDIS all have great tools to help.

One other source that is not to be overlooked is your local disability insurance brokerage outlet. These are the experts in many areas, all on DI. They have tools, they have knowledge, they can help with marketing, and they can help with sales calls in some cases. Most DI brokerage outlets represent several carriers so that they can provide you an assortment of products to solve insurance needs.

Petsche: I have my three questions:

 1. If your car were stolen or destroyed tomorrow, how quickly could you find another car to drive?

 2. If your house burned down, how soon could you find a place to live?

 3. If you became sick or hurt and your doctor told you that you could not work for the next six months, two years, or the rest of your life, do you have an income guaranteed to cover your regular monthly bills, no matter how long you cannot work? Your income potential in your working lifetime is several million dollars—that is, if you don’t become disabled.

Phillips: ASK! Ask clients if they have DI.

If they do have DI, ask if they know what they have (chances are they won’t). If they have group coverage at work, ask to review the policy to point out any shortfalls and perhaps provide input on insuring any benefit shortfall relative to their income. Ask if an individual policy they have will cover their current situation. Ask if you can do a DI policy audit to ensure proper coverage.

If clients do not have coverage, ask how it would impact their lifestyle if they were sick or injured and couldn’t work. Ask if you can provide an affordable solution to the exposure they have.

Q: Many DI specialists share the view that every month should be treated as if it were DIAM. What can be done to convince specialists in other insurance fields to impress upon their clients the need to protect their income?

Cohen: Specialists in disability income protection find selling the product quite easy. This is because they know and understand the policies. Specialists in other insurance fields need to be educated so they, too, become knowledgeable and comfortable addressing the concept of disability income protection with their clients. At our agency we spend as much time as needed going over the disability policy illustration with our brokers, preparing them for the appointment; we are not satisfied until we have done our job of making the broker secure in his knowledge and comfortable with the previously uncomfortable. Knowledge is power.

Davidson: Unfortunately many financial advisors wake up to the importance of this issue only after one of their clients suffers a disabling illness or injury. In our practice we spend every day attempting to save these individuals from becoming an example which motivates their financial advisor to do the right thing.

Gentry: The great part about DIAM and using the Life Happens resources is that May becomes the launching pad for DI outreach—a great beginning. You can give your own campaign a big burst of energy while the national campaign is underway, and you can leverage the national attention that’s being put on DI. Then it goes back to consistency. Continue to use those DI resources throughout the year. Most of Life Happens resources—realLIFEstories flyers and videos, and social media posts—can be used any time of the year. Set up a calendar of when and how you are going to communicate about DI, and then stick to it.

Lundquist: As I noted earlier, a financial advisor’s responsibility is to help people protect what is most important. For nearly all wage earners, income is most important. If the broker is not familiar with disability insurance, that is not a valid excuse for not addressing income protection. There is plenty of help available to get educated, and plenty of opportunities to partner with experts to create the best solutions for a client. Some years back, LIMRA surveyed brokers who did not sell disability insurance and asked them why. The most common response was “the client didn’t ask for it.” That is simply not acceptable. The advisor’s job is to help the client understand his risks and to protect against them. Some people will talk about the broker’s liability because they didn’t talk about disability insurance to a client who subsequently became disabled. As a trusted professional, I cannot imagine having a conversation with a client who has suffered a disabling illness or injury, or perhaps having that conversation with one of that person’s loved ones, and having to explain to that person why there is no protection in place for that person’s lost income. For many, their lives will be completely ruined.

Petersen: While we in the disability insurance industry believe every insurance professional should always include DI, the reality is that they can’t (or won’t), for many reasons. This is one reason the need to network with others in our industry can be a useful tool. The specialists in other fields don’t need to know about disability insurance as much as they need to know (and use) the resources that can analyze, design and implement a DI plan. That may be a producer to split cases, or a brokerage outlet, or a carrier rep. If they want to do it alone, they should also know the online tools and resources we have already mentioned. A specialist in another field should understand that if their client becomes permanently disabled, he may lose them as a client! A CPA will not have a business client. However, a business owner disabled and with business overhead expense DI coverage will need a CPA! An investment advisor will find that a disabled person becomes a survivalist, and discretionary income for investing is much tougher to part with during a disability. A life insurance specialist should ask himself, “What if my client doesn’t die from a severe accident or heart attack?”

Petsche: Every plan/program that you can set up in the financial services area is dependent on your income to keep them going, and once that money machine—you—breaks down, all your plans just become liabilities. Should we protect the goose? Or the golden eggs the goose lays? Too many advisors and their clients want to insure the golden eggs.

Phillips: If a person becomes disabled, the other specialists need to recognize that there is a good chance it will affect the client’s ability to pay the premiums on the products or investments they have sold. The fact is, before IRAs, before life insurance, before 401(k)s, before long term care insurance, there should be disability income insurance. Not only does it protect a paycheck, not only does it protect the lifestyle a client has grown accustomed to, it also protects the very plans that have been implemented to secure the individual’s and family’s financial future.

Q: In your experience, what are the main difficulties/objections you encounter in trying to market DI either to agents or to consumers, and how do you overcome them?

Ken Bloch: The biggest consumer objection is “sticker shock.” If the producer explains disability insurance in understandable terms with the policy premium at 2 percent or less of gross income as a starting point, the consumer can then design a policy that will provide value and peace of mind. [KB]

Cohen: This is a typical conversation when talking to a new broker: “Do you offer disability income protection to your clients?” Most answer no. “Why?” we ask. The most common answers we get are: “I don’t want to be bothered.” “I am busy with my casualty business, health insurance, etc.” “It’s too complicated.”

The real objection is that the broker is uncomfortable with his lack of product knowledge. We help brokers overcome the real objection of why they do not offer disability income protection to their clients by letting them know that our agency marketers are here to help them understand the product and how to offer it.

In overcoming objections from the consumer there are only four basic objections. Everything else is not a real objection. The four basic objections are: 1) no need, 2) no hurry, 3) no confidence, and 4) no money.

I gave examples earlier of questions to ask to establish the need for disability income protection. Once the client understands that he needs the policy, you have overcome objection number 1. 

Objection number 2 is “no hurry.” When your client knows he needs disability income protection, he will act. You have overcome the “no hurry” objection.

Objection number 3 is “no confidence.” If you have the knowledge, your client will have confidence in you. It is your job to obtain the knowledge by reading the material that companies have developed for producers and by working with a knowledgeable brokerage agency that can give you all the time and support you need.

Objection number 4 is “no money.” This is the final objection and this is when you ask the client, “If the company were to deduct x amount of dollars from your checking account every month, would this create a financial problem?” If the client says no, you are done! If the client says yes, then you state, “I am not here to create a financial problem, I am here to solve one.” (This approach only works because of its sincerity.) Then we work together to reduce the benefit and premium to something the client can manage.

Every day in our office is disability income protection awareness day. Every day we are teaching, training and talking disability income protection to our brokers and to each other. It is great to be a part of an industry that does so much good for people. [EC]

Davidson: A well-versed and motivated financial advisor encounters very few legitimate objections. We have worked closely with advisors whose placement ratio is almost 100 percent. This comes from understanding the needs of the client and the solutions that are available. Everyone wants what disability insurance does—our job is to help the client position it into their plan and budget. [GD]

Gentry: I see it less as an objection and more of an issue of something we don’t talk enough about. Health agents aren’t selling DI, P&C agents certainly aren’t selling it, and most life agents don’t sell it either. But the truth is, none of those other types of insurance meet the need that DI does. There is a huge gap between consumers who need DI and those who have adequate coverage.

I think the key is focusing the conversation on “protecting your paycheck.” People aren’t necessarily open to talking about disability insurance—they may not even know what it is. However, they will be open to knowing what can help them if an injury or illness keeps them out of work for an extended period of time. Life Happens did a survey that found that 50 percent of people would have financial troubles either immediately or within one month of not receiving a paycheck. That’s a crisis. We have the tools so that agents can help their clients solve this problem. Now we need to start using them. [CG]

Lundquist: Some common objections from brokers: It’s too complicated, it takes too long, and policies are too often modified from what was applied for. The first thing I’d say is: Just because something is hard doesn’t mean for a second that it is any less important. The more brokers learn about disability insurance, the more policies they sell and the easier it becomes. They can make sure the prospect knows what to expect if they themselves know what to expect.

Many very successful disability brokers that I know have made the observation: If I knew then what I know now I would have started selling disability insurance much sooner. Many companies today are offering multi-life programs on a guaranteed issue, simplified administration basis. Those multi-life programs can certainly make the process easier.

Another tip is to focus on younger wage earners. When someone is early in his career, his risk of disability over the many years he will work until his retirement is much higher than an older worker who has fewer years of work remaining. That younger worker’s earnings potential is significantly higher than the older worker for whom many of his earning years are behind him.

So the youngest prospect has the most to lose and the highest odds of losing it. Younger workers often have few financial resources to fall back on. And for younger workers, it is typically much easier and less expensive to purchase income protection.

Other benefits to brokers besides doing what is right for clients: There is less competition in the disability insurance marketplace and commissions are lucrative, especially renewals.

Some common objections from prospects: “It costs too much.” This may simply be a reflection of not appreciating their level of risk. Discuss the consequences of disability; ask how they would pay the bills. Ask if they know others who have had cancer, or a stroke, or experienced a bad accident. Use the Personal Disability Quotient calculator. Many wage earners assume that disability insurance is much more expensive than it is. Finally, don’t forget that having something is better than having nothing. Help them get something in place that can be built on in later years.

“I’m healthy.” It is certainly the case that a person can lower his risk of disability substantially by living a healthy lifestyle, keeping weight in line, eating right, exercising and so on. In fact, a person can cut his risk of disability in half. But even the youngest, healthiest person has a risk of disability that is too high to ignore.

“We can get by on our savings and (other sources).” Help them do some math. How much do they need each month to pay the bills? What sources of income would they tap into, how much would be available, and how long would the sources last? Finally, quantify the gap between needs and income sources. Help them learn how to best fill that gap.

Also keep in mind that the average long term disability, once the claimant satisfies his elimination period, exceeds 2.5 years. He needs to be prepared to withstand a disability that can last for several years, or one that may even end his working career.

Helping overcome objections is where stories and passion come most into play. Telling stories about others who have experienced disability and especially getting clients to talk about people they know who have experienced illnesses or injuries can certainly help. Many people don’t think they know anyone who was “disabled,” but when asked if they know someone who has had cancer, a stroke, or even chronic back pain, most everyone will say yes. Our Council for Disability Awareness research demonstrates that when an individual knows someone who has experienced a disability, they think their own risk of disability is higher.

Perseverance counts. Keep asking, keep reminding. As any successful salesperson can attest, the sale is very often made after many attempts. [BL]

Petersen: The DI industry has done a great job of educating insurance professionals that disability insurance is cash flow. More life insurance is sold for asset protection than for a “need for cash.” When insurance professionals who speak about assets as things that are important to insure realize that disability insurance is asset protection, then they begin to include it in their day-to-day sales. The same perception applies to the end buyers, too. People don’t visualize losing income as easily as losing a house, keeping kids in school, wrecking a car, etc. A long term disability will result in the same liquidation of those assets if they are not protected by disability insurance. We must do a paradigm shift in thinking about what disability insurance truly is. It is asset protection! [TP]

Petsche: The biggest obstacle we have to overcome with both brokers and consumers is the perception that “disability will not happen to me.” The best way to overcome this objection is by telling emotional and motivating stories about our experiences dealing with what happens to individuals with and without disability insurance. Also, show the law of averages that relates to disability, because the odds are not in their favor. [TP]

Phillips: The biggest hurdles, in my experience, have been cost, recognition of exposure, and perception of the underwriting process.

Cost is the major objection to many insurance sales. I’ve found that if the advisor gets the client to focus on the amount of annual and total payouts the DI plan could provide in the event of a claim, it helps. For instance, for a 40-year-old business owner who is considering a $5,000 monthly benefit, stress that this is $60,000 per year; and that the total potential payout to age 65 is $1.5 million. In that context, the premium relative to the benefits provided is perceived as much less than if presented monthly.

Statistics abound that provide the realities of the exposure an income earner has to a disability. The Council on Disability Awareness has information available to help point out this exposure, as does the Life Happens site, www.lifehappens.org.

The facts are that the DI underwriting process can be involved and tedious. Accurately pre-screening the client as well as detailing the process and the reasons behind the scrutiny involved must be explained to the client. The amount of potential benefits requires a process that allows carriers to mitigate their own exposures.

But within that framework a number of carriers have come out with a simplified underwriting process that can be less invasive for clients up to a certain age and benefit amount. Exploring that process for the client’s particular situation can be an effective way to cut the time and consideration involved. [RP]