New Critical Illness Association Targets Education To Field And Public
What are the key issues confronting the young and still developing critical illness insurance industry in the United States?
They include claims, underwriting, definitions of covered illnesses, taxation of benefits, state approvals of policy filings, product design and producer-consumer education, said Alan E. Watson here at the first annual meeting of the National Association for Critical Illness Insurance.
Watson, who is senior vice president-independent agent distribution at Protective Life Insurance Company, Birmingham, Ala., is the associations 2003 president.
The new association addressed all of the above issues in three educational tracks during its first meeting. The three tracks were: product and market education; risk management; and distribution.
Such education is one of the key goals of NACII, said Watson.
Two other goals are to disseminate information and education about CI insurance to the field and the public; and to act as a catalyst for CI industry positions and policies, he said.
CI insurance pays a lump sum to insureds diagnosed with one of the policys covered conditions.
Though it is a fairly new product line in the United States and though NACII is a brand new organization, the meeting drew over 80 attendees.
Organized a year ago by Daniel R. Pisetsky, managing director of US Living Benefits, Manchester, Conn., the nonprofit trade group seeks to raise awareness about, and understanding of, CI insurance. It has a full slate of officers, 14 board members, seed money from various sponsors and a membership of about 50.
The executive director is Norbert Kraich, owner of The Kraich Company, a Washington, D.C., association management firm.
The CI product line is not new, allowed Watson. He detailed a 20-year history of development in many countries, including its arrival in the U.S. in the mid-1990s.
In the U.S., CI insurance is just now pulling out of five years of “socialization” and readying for a surge in growth, according to Watson.
Association organizers did weigh whether they should form a trade group to help that growth along, he indicated. That discussion came down to one question, he said: “Do we wait or do we push ahead as we address and resolve these issues?”
The decision was to get something done now.
Technology advancements have increased the human lifespan, Watson explained, and there is now hope for illnesses that were once deemed hopeless. But increasingly, he continued, “we are hearing about financial ills caused by trying to maintain ones lifestyle when faced with a critical illness event” that a person survives.
Since CI insurance is designed to help alleviate some of those financial strains, the association leaders believed they should do what they can to provide education and awareness of this coverage, Watson told NU.
The group provides networking opportunities, a password protected Web site (www.nacii.org), publicity of key issues via press releases and research data, Watson said.
In the coming year, the association will work to strengthen its benefits for members, such as the secure Web site, said Julie F. Marshall. She is executive vice president of USAble Life, Little Rock, Ark., and the newly elected president of NACII.
In the coming year, NACII will also offer a “producer recognition program,” along the lines of that provided by the Million Dollar Round Table, Marshall told NU.
“We want to provide a place to educate producers on CI,” she explained, “and we want producers to be part of the association.”
This last reflects a dominant theme at the meetingnamely that the industry needs to educate producers and the public about CI insurance.
“The challenge and the opportunity are the same,” explained Jesse E. Leverette Jr., president of The L Group, a Ridgeland, Miss., firm that develops sales and marketing systems.
“We need to educate, educate, educate on CI insurance,” he said.
For example, Leverette said, “agents are creatures of habit. They dont like to change.” So, if CI insurers want to reach agents, they need to keep talking about the product.
After six or eight meetings on the topic, “they get excited about it,” said Leverette.
What helps in the discussion, he added, “is that CI is a product that is going to pay you.” That is, the insured doesnt have to die to receive the CI benefit. Insureds get the benefit following diagnosis of a covered illness.
Producer education should not be just about product, Leverette stressed.
“We require compliance training, too, on how CI insurance works and how to sell it,” he said. “And we require CE as well, because things are changing continually concerning the products and the needs for it.”
Training should include providing total disclosure to the client, too, he said.
“Get in the trenches and teach them to fish,” Leverette concluded.
Also train the field on what the covered conditions are and what they mean, suggested Joe P. Crawford, CI manager at The L Group.
This is important when communicating with clients, he said. For example, “one agent lost a sale because he didnt know that renal failure was kidney failure.”
Other areas to focus on include finding the right target groups and finding the right person at the employer with whom to speak (if selling worksite CI), said Crawford.
In worksite cases, its important for agents to spend time with each employee, educating on CI and not selling, Crawford maintains. For example, “We ask the employer to guarantee that we can see each employee for 15 to 20 minutes,” he said. Then, his firm sends each person home with a brochure and materials. The signup is handled later.
The results? “How does 60% to 80% signups sound?” he asked.
Yes, agreed Leverette, “You get results with education.”
Reproduced from National Underwriter Life & Health/Financial Services Edition, October 3, 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.