Disability insurance is an often undervalued and overlooked product line of the greater health insurance market in this country. As a devout life insurance advisor, DI might not regularly be on your radar. Sure, a request for some disability insurance may fall into your lap on occasion from a curious client or from a concerned prospect who has had someone close to them unexpectedly fall ill and become disabled. But your livelihood is life insurance, and that is what you know best and what has made you a success.
You may argue that DI can be a tougher sell, and the policies and riders are sometimes confusing to the layman. The general public is more familiar and open to spending their money on life insurance. Death is a certainty, disablement is not. These are valid points, but I am here to lend some insight and reasoning as to why that thinking is antiquated and somewhat misguided and why disability insurance should be a more regular part of your business as well as a natural complement to your everyday life insurance sales.
Disablement may not be a certainty to your clients, but it is absolutely a sobering reality. The chances of becoming disabled and losing the ability to earn a living during one’s career are three times more likely than dying during that same period of time. Furthermore, 25% of those venturing into the workforce today can expect at some point to become disabled for at least a period of 12 months in duration prior to normal retirement age. Disablement causes severe financial consequences. Over 40% of filed bankruptcies in this country stem, at least in part, from loss of income due to medically-related disabilities. Financial protection from disablement is imperative and the insurance solutions organically go hand-in-hand with life insurance sales.
Consider for a moment your average client who has a comfortable lifestyle, an economically dependent family and an adequate financial portfolio including life insurance. The client becomes disabled due to an injury or illness and is unable to work and earn that paycheck. How is he or she going to maintain their lifestyle and provide for that family without prematurely raiding the savings accounts and the investment and retirement vehicles? How is he or she going to pay those life insurance premiums? Personal DI will provide financial safeguards to protect your client’s most important asset – his or her ability to earn a living.
Cross-selling opportunities abound when considering adding DI to your life sales pitches, especially for business insurance needs. Key person life policies are important pieces of protection when indemnifying contracts like buy/sell agreements and business loans as well as funding business continuation and succession plans. Why shouldn’t disability insurance be part of the same equation to complement the death benefit? Traditional and specialty DI markets offer varying platforms to cover the interests of business owners and the employees and families that depend upon business continuity.
Disability insurance and income protection are fundamentally as important as life insurance to any prospective working client out there. The dutiful prescription of DI appropriately balances a life sale as you not only look to protect the client and their estate in case of unexpected demise, but also in the case of the more probable disablement that could in the long term alter their lifestyle and career.