Read Part 2 of this series here.
Making it in the life insurance biz isn’t a walk in the park.
Not a lot of people outlast the one-year mark on their own.
It’s actually about 1%. And even after making it well beyond that first year, it can still be a difficult business to sustain and grow your revenue, even for industry veterans.
Let that sobering statistic be the impetus for you to consider partnering with a General Agency and expanding the services you offer.
The right GA can help you with the “extras,” like disabilities and annuities.
Let’s take a closer look at each of these solutions you could start offering to your clients.
Disability insurance
The simple truth is that your clients may not even realize they need this type of coverage.
Disability income insurance replaces a portion of the income a person would lose if a disability prevented him from accomplishing his job duties.
This incapacitation could be the result of an injury or an illness.
It’s estimated that one out of every four people in the United States will experience some type of injury or disability before they reach retirement.
You’d think that everyone would see the need and jump on board, right?
Not exactly.
Here’s what holds some people back.
- They don’t know that any options exist outside of what their employer may offer – if anything at all.
- Self-employed people don’t have the opportunity for employer-backed coverage and what the state provides is typically inadequate for high-income earners.
- Many insurance producers aren’t talking to their clients about it – often because they aren’t as knowledgeable about it.
- Insurance producers are putting their focus on long-term care insurance instead.
How a Disability insurance policy works
Before your clients will be ready to jump on board, they have to understand what the coverage is and the main benefits.
- Rehabilitation benefit. Often, an injury or accident will require some sort of rehab time as a part of the recovery. A Disability policy will help with these costs.
- Death benefit. Your clients’ beneficiaries will receive a lump sum benefit if your client dies while covered by Disability insurance.
- Waiver of premium benefit. Once the Elimination period has been reached, your client may be reimbursed for the premium payments that were made over the period of time they qualify for disability.
Sharing is caring
Your clients trust you.
They understand the worth of working with you.
Explaining the importance of Disability Income Insurance is another way to further your value and also minimize the risk to your clients.
You’re providing them with a safety net to protect their families financially if they’re unable to work because of an injury or illness.
Nobody wants to have to raid their savings or retirement funds to fill in the gaps of a difficult time.
It’s up to you to share the important facts with them – and counter their objections.
Here are some of the arguments you might hear.
Objection #1- I’m healthy so I don’t have to worry.
The truth is that you can’t predict what’s coming around the next bend.
Accidents happen and so do illnesses. Planning AFTER becoming disabled doesn’t work too well!
Objection #2- It’s too expensive.
Disability insurance is actually a low-cost option that can pay off big.
It doesn’t take a whole lot of money for your clients to invest in a flexible policy that’s customizable to their budget and unique needs.
Objection #3- I’m covered by my job.
Even if a client has Disability Insurance through their employer, it’s usually not enough on its own.
With a separate supplement, your clients can rest assured that they’re fully protected.
It’s your job to make your clients see that – even if they’re young and healthy – anything can happen and they need to financially protect their family’s future.
Annuities
One of the products that you can offer to your clients as a way to bolster your income is annuities.
Many insurance producers aren’t too keen on selling annuities.
They think it’s too complicated and they don’t really care to dig in.
If you’re thinking this way, you could be missing out on a valuable product that could benefit your clients.
Let’s get down to the basics.
The ABCs of annuities
An annuity is an income-oriented insurance product.
There are two categories: deferred and immediate.
Deferred annuity
With this type of annuity, money is paid to the insurance carrier where it accumulates until the annuitant (the person who receives the money) is ready to start taking money out.
It’s usually during retirement.
Immediate annuity
In this case, the annuitant begins to receive payments soon after they start making deposits to the insurance carrier.
Within the parameters of deferred and immediate annuities are two categories.
- A fixed annuity is a contract between an insurance company and the customer. The company is obligated to make a series of payments to the customer for the duration of the contract. They provide a guaranteed and steady income.
- A variable annuity may be used as a retirement supplement. It’s tax-deferred and allows the client to choose mutual fund investments, which determines the amount that’s paid out. This is not a guaranteed income.
The benefits
There are three primary advantages of annuities.
#1- Triple compounding interest
Annuities pay interest on the principal balance, interest on the interest that’s earned, and interest on the taxes that would have been paid if it was in an investment that was being taxed annually.
#2- Guarantees a lifetime income
Annuities are a great component of a retirement plan because they allow the contributor to access their money without tax penalties as long as they’re past the age of 59 ½. In the case of an emergency, your client can get to their funds without any penalty.
#3- Convenient and safe way to leave an inheritance
Annuities aren’t subject to probate so there’s no worry that a court will decide where your client’s money goes should they pass away.
The “extras” fill in the gaps
To make it in the competitive world of Life Insurance, you have to have the right support from a General Agency and the ability to give your clients as much value as possible.
Offering them “extras” like Disability Insurance and Annuities provide a way to generate more revenue for you and offer benefits and solutions to your clients.
Are you working with a GA to educate your clients about the benefits of Disability Insurance and annuities?
