CI Insurance Producers On A Mission
“Agents have not been adequately trained to help their clients face up to the financial quagmire that many encounter as a result of critical illness,” contends Robert Littell, principal of Littell Consulting Services and Second Opinion Insurance Services LLP, Atlanta, Ga.
He is referring to the quagmire caused when clients are so deeply in debt that they have no means of paying all the expenses that go with a critical illness.
These are individuals who stand to benefit from owning stand-alone critical illness insurance, says Littell, who is a broker. “They can afford it, and they need it.”
But first, someone needs to bring the product to the customers attention, he says.
Littell and other CI insurance experts believe there are several things agents and insurance companies can do to accomplish that purpose.
The personal debt that some people carry is so high, Littell says, that “many are but one heart attack, stroke, life-threatening cancer, or organ transplant away from bankruptcy.”
Affluent people are particularly at risk, he says.
“They have a mortgage on their home, perhaps a home equity loan, too, or a second mortgage, an auto loan or auto lease obligation, college loans for their children, and thousands of dollars in credit card debt.”
The problem is, people seldom, if ever, take the time to add it all up, Littell contends. “This may be due to fear, denial, or procrastination, but in any case, the problem needs to be confronted.
“This mounting debt is a crisis thats on the doorstep of millions of people, particularly if a critical illness occurs,” he says.
Delivering the message can be the mission of the critical illness insurance producer, says Littell.
“Ask clients about their outstanding debt,” he suggests, “and then consolidate it. Show them how much they owe now, and then ask how they will pay for their expenses if a heart attack or some other serious illness should strike.”
Some people have misconceptions, he says. “They may answer that their life insurance or medical insurance will pay for the medical expenses.
“But the producer can point out the reality–that life, health and disability insurance, if the client has all three, wont pay for everything.”
He is referring to the out-of-pocket costs, the travel expenses to see specialists, the extra charges for using out-of-network specialists, the special equipment or experimental medications, and so on. A lump-sum payment from a CI policy could help the client manage all that and more, he says.
Before agents can reach very many customers effectively, however, they need to get an education, say experts.
For instance, “they need to be educated on the products that are available and how they fit into the financial plan,” says Alphonso Franco. A top CI agent in Canada who has been selling the product since 1996, Franco has authored a CI selling system.
To be successful in this market, Franco maintains, agents have to own the insurance themselves.
“They must be passionate about what they are selling. They have to live it, breathe it and own it. Then, they can go sell it.”
Agents can always start out by offering the product to their existing clients, says Franco, who is president of Trenton Financial, a CI insurance specialty firm in Victoria, British Columbia, Canada. He is also CEO of Critical Illness Insurance Centre, also of Victoria.
Such agents may choose to include the product in the full line of products they offer. They will function as generalists, calling in CI experts as need arises.
But agents can specialize in CI insurance, too, Franco says. To do that, producers will need to study the data on occupational classes and their likelihood of suffering certain kinds of critical illnesses. They will need to understand the treatments of various diseases and the financial consequences of surviving diseases. They should study medical textbooks and take courses.
For instance, pilots, leather tanners, gardeners and hairdressers are all subject to certain types of critical illnesses. The CI specialist would know that and know how to explain the exposure to the client.