Prescription For DI Sales Success In A Down Economy

Focus on return-to-work. When putting together plans for clients, keep in mind that insurance products with a return-to-work focus in claims management result in fewer or shorter claims and premium stability. Using clinically based claims management, employees can return to the workplace more quickly and safely, and no longer rely on insurance payments.

Suggestion: Make sure you understand how the insurer handles claims from both a service and outcome standpoint.

Be sure plan designs are simple and straightforward. When plans are too complex, with policyholders covered by two or three different carriers and programs, the likelihood of abuse increases. In many cases, plans are so rich and the taxability so complex that employees can make more money by not working. That means there is no incentive to return to work, resulting in unnecessary extended absences that cost employers and insurers money.

Spread sales out to nontraditional occupations. Look at any producers book of business and you will probably notice concentrations of policies in certain fields of work: doctors, lawyers and white-collar executives. The danger in concentrated portfolios is obvious. A bad year for doctors means a bad year (or more) for your business. Just as you diversify your personal investments, you should do the same for your book of business. Mix in manufacturing groups, hospitals and nonprofits. You will cushion your earnings during bad economic times and never overexpose yourself in any one industry.

Diversify your client base. Do not concentrate solely on large customers. While they may make for a more efficient sale, they tend to offer smaller profit margins because of higher claims rates. Take a look at smaller companies. The small case market has higher profit margins, lower claims rates and you will have direct access to the decision makers.

Introduce your current clients to disability. Most clients start off with medical insurance, add life and then consider disability insurance later in the relationship. That leaves a wide open market to sell disability insurance. Did you know that only 35% of employees have long term disability coverage? And, did you know the number-one reason why companies do not offer disability insurance is that their brokers have not told them about it? In some cases, you may have talked to your client about disability coverage in the past; it may take a few tries before you get the attention of the buyer.

The economy may be down, but your success in the insurance market does not have to follow the same pattern. Smart selling is the key. By understanding your clients, buying patterns and historical performance, you will be able to keep your block of business healthy and able to weather any economy.

is managing director at Disability RMS, a Portland, Maine, subsidiary of CORE Inc. He is also past chair of the Disability Subcommittee of Health Insurance Association of America. His e-mail is [email protected].

Reproduced from National Underwriter Edition, February 24, 2003. Copyright 2003 by The National Underwriter Company in the serial publication. All rights reserved.Copyright in this article as an independent work may be held by the author.