There are a number of challenges in selling disability insurance – not the least of which is the difficulty in motivating consumers to purchase disability in the first place, followed by an often lengthy and cumbersome closing process. As brokers and agents begin to set 2011 sales goals and forecast activity levels, you can achieve premium goals by identifying a healthy supply of prospects. Simply put, the more prospects, the more opportunities to improve closing ratios.
As untapped markets go, two distinct segments of consumers are in the greatest need of DI: singles and women.
Single, never-married workers often overlooked
Many people assume that single workers need disability insurance coverage less than other prospects. However, single consumers arguably have more of a need to financially protect themselves in the event of a disability. Although they may not have family to consider, single workers will still need some form of financial income to sustain their lifestyles if they become disabled, and they have no spouse upon whom to rely.
According to a recent Aflac study, 53 percent of single workers say they are either not very or not at all prepared to pay for out-of-pocket expenses in the event of an unforeseen accident or illness. Meanwhile, they are more apt than their married counterparts to believe they'll likely become disabled in the future. Furthermore, single workers are the least likely to be enrolled in disability insurance, compared with married workers (29 percent versus 33 percent).
Beyond the means, women also have a greater need
There is also a great opportunity when it comes to women and disability insurance. Several factors clearly illustrate the need for women to secure disability insurance coverage, including their growing roles as breadwinners and decision-makers.
Not only do women make up the majority of the workforce, but they are beginning to take on more responsibilities for family decisions and finances. A recent survey by GfK Roper for NBC Universal found that 65 percent of women said they are their family's chief financial planner, and 71 percent called themselves the family accountant. Women also make 75 percent of the buying decisions in American homes, according to a Mediamark Research and Intelligence survey.
According to the Journal of the American Society of Certified Life Underwriters, a 35-year-old woman in a professional position is three times as likely as a man of the same age to become disabled for 90 days or more. That's a sobering and relatively unknown fact that should be made known to women. Given the reality that many women are becoming breadwinners and, often, the sole income provider, adequate disability coverage is a must-have for those seeking to protect their high incomes and ensure financial stability for their families in the future.
Many women underestimate their risk of experiencing a disability and overestimate the resources available to them in such an event. The Aflac study found that only 28 percent of women are enrolled in disability insurance, compared with 35 percent of men, and are less prepared to pay for out-of-pocket expenses associated with an unexpected illness or accident (55 percent of women say they are not very/not at all prepared).
Better education about benefits options
Although many women and single workers have assumed they have coverage through their employers, a growing number of companies are cutting back on disability along with other coverage as they grapple with rising health costs. While disability insurance has historically been a staple of workplace benefits packages, the recession caused many companies to scale back their amount of coverage or remove it altogether.
Adding to the challenge is the fact that many of these workers are not receiving the education or information they need about their benefits options. According to the Aflac study, only 57 percent of single workers get their benefits information from brokers or benefits consultants, compared with 72 percent of married workers. And, nearly one-quarter (23 percent) of single workers and female employees say they are either not very or not at all informed about their benefits options.
Agents and brokers educate consumers on what disability insurance can truly protect, reminding these workers of the following:
- Loss of income makes it impossible to build retirement savings.
- Without sufficient income, consumers may be forced to withdraw from retirement accounts to pay for current expenses.
Target independent or female small business owners
Agents and brokers can also help build their books of business by introducing and explaining the voluntary benefits solution to businesses. For companies under financial strain and pressure to cut costs, voluntary short-term disability insurance can be a no-cost solution for employers who want to maintain disability coverage options and financial protection for their employees. Voluntary disability insurance can demonstrate a company's commitment to its workforce without breaking the bank.
Small businesses are often referred to as the engine of the American economy. Yet most small businesses don't carry group disability insurance, so brokers and agents have an opportunity to introduce a variety of solutions to these organizations, including group short-term disability and individual short-term disability insurance plans.
Prospecting for new business is never easy. Even in the best economy, successful prospecting takes perseverance, determination, and a thick skin. Nonetheless, brokers and agents should focus on prospecting in this new year, so that they don't miss the market for disability insurance coverage for women and single workers.
Thomas R. Giddens is senior vice president and director of sales for Aflac. He can be reached at 800-992-3522.
For more exclusive disability insurance coverage, visit ASJ's Disability Resource Center.
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