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With many working Americans unprepared for even a short income interruption, protecting household income should be a priority.
Yet disability insurance's role in safeguarding income and supporting continued financial wellness is too often overlooked.
As many financial professionals know, employer-provided disability offerings are an important and popular option.
Yet with many of these plans only covering a portion of a client's base pay, an individual disability insurance policy may be needed to help close the remaining gap.
That's why educating clients about the benefits of disability insurance and helping them understand how it can protect their lifestyle and family is crucial.
Here are three strategies for engaging clients in impactful discussions on this important topic.
1. Clarify what qualifies as a disability.
A common misunderstanding about disability insurance is that disabilities must come from a workplace-related injury or that coverage only applies to catastrophic conditions like paralysis from a car accident or a debilitating stroke.
Many individuals do not realize that the most common short-term disability claim is actually for maternity leave.
Across the industry, many are also seeing an increase in mental health-related claims.
The reality is that disabilities can occur at any time and place, making it essential for clients to have coverage that protects them in all situations.
2. Highlight the potential financial impact of a disability.
The financial impact of a disability leave can be devastating and long-lasting.
Guardian data shows that for those out of work for nine months or longer, 73% reported that the outage had a major or devastating effect on their finances.
To cover day-to-day living expenses, nearly four in ten of those who are out of work due to a disability have had to withdraw money from savings, investments, or retirement accounts.
By showcasing both the short- and long-term financial implications a disruption in income can have on a client's finances, financial professionals can demonstrate the crucial role disability insurance plays in safeguarding a client's financial future.
3. Emphasize the importance of acting early.
When it comes to purchasing disability insurance, acting early has its advantages.
Generally speaking, the best time for a client to purchase disability insurance is early in the client's career, when premiums are lowest and health is typically good.
Major life milestones such as starting a family, buying a home, or becoming self-employed can also signal it's time for a client to protect their income.
Ultimately, the sooner a client takes action, the better prepared the client will be if the unexpected happens.
Claims happen.
No one anticipates needing to take a leave from work due to a disability.
If and when they have to do so, their focus should be on getting better — not on managing their finances.
That's why disability insurance is such a vital component of financial wellness and overall well-being.
When financial professionals help clients understand the importance of disability insurance and take proactive steps to secure coverage, clients can better futureproof their income and protect their financial wellness for years to come.
Harry Monti is head of individual disability and multi-life at Guardian.
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