Insurance producers may be missing out on an opportunity if they are not actively engaging with disability income insurance carriers to secure an important source of replacement income for employees in the event they cannot continue working due to a disability.
In these tough economic times, it is even more critical for those who are holding a job to protect their income. With the stock market decline, many people’s savings accounts have dwindled, and they have less of a cushion to fall back on. Should there then be an event that jeopardizes their ability to work, a financial safety net is needed.
Disability income insurance is the one product in the insurance market that guarantees that a portion of a worker’s income will be replaced, no matter what accident or illness comes their way. DI insurance doesn’t just fill a financial gap; it is the bedrock of families’ financial security.
This presents a huge sales opportunity for insurance professionals. Only 39% of Americans have some form of DI insurance, with only one-quarter of this group having portable supplemental disability income insurance, according to a study by Massachusetts Mutual Life Insurance Co., Springfield, Mass.
Even for many who do have some long-term disability insurance, coverage may be inadequate.
No one expects to have a catastrophic event in their life, but it happens. I know this from personal experience. While riding my bicycle on June 13, 1998, I was suddenly crushed by a falling 3-1/2-ton tree and paralyzed from the waist down. My income came to a complete stop. I was very fortunate to have a DI insurance policy in effect and have received benefits checks ever since my injury. My life would have taken a different direction had I not had this insurance. Not only would this have affected my life but also the life of my husband, who was suddenly the sole wage earner in the family.
People like me, lucky enough to be alive after such an accident, need a source of income to pay their bills. For me, that included bills from my hospital stay, surgeon, attending physicians, medications, medical equipment (wheelchair, walker, canes, crutches), personal care assistant, and physical and occupational therapy. On top of these injury- related expenses were my daily living expenses, such as home mortgage, taxes, insurance, gasoline, food and utilities. Disability income insurance is “living insurance.”
Often, insurance professionals find that a potential client resists having a conversation to discuss income protection. People often think, “It won’t happen to me.” As an advisor, it is your role to talk to prospects about the likelihood of a disability so that they can make an informed judgment based on the facts.