In the world of disability insurance, some income protection proposals crash and burn while others effortlessly convert to sales. Are you taking every step needed to position your proposals for success? While there are countless sales tactics to learn, these 12 points represent the foundation of DI sales professionalism. Agents with high closing ratios typically do each of these things with each and every client.
Read on to find out why these steps are so important — and how you can start incorporating them into your presentations.
1. Create need by showcasing the DI window of opportunity.
People don’t purchase income protection unless they really understand the need. One way to establish need is by sharing stories and statistics about the risk of disability. Another way is to compare income with other assets. For example, ask clients what would happen if their homes burned down and they weren’t insured. Obviously, they would lose a big asset.
Now, ask them if it’s possible to purchase insurance for a home after it has already burned. Clients will laugh because everyone knows you can’t buy insurance for a home that already burned. And that’s the “gotcha” that sets up the DI window of opportunity.
Next, ask them what happens if they become disabled without income protection insurance. Obviously, they lose their ability to earn a living. But what happens if they apply for an income protection policy after they have a disabling illness or injury? They can be just as difficult to insure as a burned house.
With this in mind, clients have a bigger need. They lack income protection and their chance to secure the protection could disappear at any time. The only way to solve this big problem for sure is to buy an income protection policy today — before illness or injury strikes.
Of course, this conversation should take place before you present your policy recommendation.
2. Pave the way to fewer price objections.
One of the biggest reasons DI policies fail is price. Advisors forget to establish price expectations up front, and clients are shocked when they learn how much policies cost. It doesn’t have to be this way. Most DI policies cost 3 to 4 percent of gross income. It’s important to let prospects know that early — with a caveat.
Also, let them know how much is being protected. Calculate the client’s lifetime income potential using this calculator. Usually, earning potential is more than $1 million. When you compare the cost of a DI policy to the amount it is protecting, the price is very reasonable. Never tell clients that DI is expensive. Tell them that for as little as 3 percent, they can cover up to 80 percent of their incomes. When you state it that way, DI is remarkably affordable.
3. Be present.
Although we are living in a virtual world, in-person meetings still convert sales much more effectively than email. Never let clients review proposals on their own.
4. Present low cost, high value.
To further illustrate the value of DI, always present the lowest premium cost (cost per day) beside the highest benefit value (lifetime earning potential). Asking someone to spend $16 a day to protect more than $1 million of income sounds much better than asking him to spend $6,000 a year to protect $200,000 of income.
5. Recommend one option.
A confused mind never buys. Therefore, it’s your job to keep things as simple as possible. If you have a pricing analysis for several carriers, avoid giving all that information to the client up front. It’s overwhelming. Carry it with you, show the client you did your homework by shopping at least three carriers and then make your best recommendation. They’re counting on you to be the expert.
6. Always summarize your recommendation in writing.
This practice demonstrates your professionalism and documents your file. If the client doesn’t proceed immediately, you also have an easy reference point to pick up the conversation when you follow up.
7. Pre-fill the application for the preferred carrier.
You should never waste part of your meeting time completing basic details you already know. Pre-filling known fields of the application demonstrates preparedness. It also allows you to focus your client time on more qualitative topics.
8. Listen with a mission.
One of the biggest mistakes advisors make is failing to really “hear” what clients are saying. If clients don’t seem convinced about your recommendation, listen and follow their lead. Many clients will immediately gravitate to one carrier. Ask questions to uncover the reasons. Often it’s something unexpected, such as the fact that a relative works for the company.
9. Seize the moment by knowing the cost per $100.
After you present, many clients will ask how much other benefit amounts cost. For example, if you’ve presented a $6,000 monthly benefit, the client may ask, “How much would it cost if I went with a $5,000 benefit instead?” Never respond that you will find out and get back to the client. Instead, provide an immediate ballpark by using a simple cost per $100 calculation. Here’s the formula:
Annual premium ÷ monthly benefit × 100 = cost per $100
Plug the values of the policy quoted into the formula to determine the cost per $100. For example, if a $6,000 premium offers a monthly benefit of $10,000, you know the cost per $100 is $60. ($6,000 divided by $10,000 multiplied by 100) To determine the price for a $5,000 benefit, simply determine the number of 100s and multiply by the cost per $100. So, $5,000 divided by 100 and multiplied by $60 equals $3,000.
10. Be frank with medical and financial questions.
Don’t be afraid to ask hard questions. It can save a lot of heartache later on. If you recognize a potential issue, you can explore a guaranteed standard issue policy, rather than wasting time on a policy that will likely be denied or laden with exceptions. Ask if clients have any medical conditions. Also ask what medications they take. On the financial side, you need to ask for their annual income and let them know the figure will need to be documented by a W2 or paystub. If the client is a business owner, ask about net income after all business deductions.
11. If clients decline, ask them to sign or initial a Waiver of Liability form.
This is crucial documentation for your file. Later, if they become disabled and file errors and omissions suits claiming they were not informed, you have documentation to aid in your defense. Incidentally, this form amplifies the gravity of the decision and causes a fair percentage of prospects to change their minds and proceed with the purchase.
12. If clients postpone, follow up.
Lack of follow-up is probably the No. 1 reason income protection proposals fail. Continue to reach out to clients until you receive a clear “yes” or “no” answer. Ask questions to uncover the true objections and to garner commitment. For example, “If I can get the premium down to $5,000, you’ll be ready to proceed — correct?”
You’ve probably noticed that these steps all have one thing in common: planning and preparation. In short, insurance professionals who do their homework sell more policies and stay in business longer.
They also usually own their own disability insurance policies. It can be difficult to sell something unless you believe in it enough to buy it yourself. One agent carried his life and disability policies with him in a nice leather binder to every appointment. He showed the binder to prospects saying, “This is the ‘I love my family enough to do the right thing’ care package.” It was a powerful tool that made an intangible product more palpable and set him apart from average agents.
Now that you know the 12 steps, there’s only one thing left to do: Make your income protection proposals sing!