why di? why your clients need it why you should sell it why your clients need it why you should sell...
TRANSCRIPT
Why DI?Why DI?Why DI?Why DI?
Why your clients need itWhy your clients need it
Why you should sell it Why you should sell it
Why your clients need itWhy your clients need it
Why you should sell it Why you should sell it
Leading Edge Disability Center
(888) 677-6575 www.disabilitycenter.com
Of all the risks you take, if you could Of all the risks you take, if you could only protect yourself against one, would only protect yourself against one, would
it be:it be:
the one most likely to occur? the one most likely to occur? oror
the one that if it were to occur, could the one that if it were to occur, could produce the greatest financial loss? produce the greatest financial loss?
Leading Edge Disability Center (888) 677-6575 www.disabilitycenter.com
Leading Edge Disability Center (888) 677-6575 www.disabilitycenter.com
1 in 1,3001 in 1,300 1 in 70 1 in 70
1 in 1091 in 109 1 in 81 in 8
Comparative Insurance Comparative Insurance Usages In A Given YearUsages In A Given YearComparative Insurance Comparative Insurance Usages In A Given YearUsages In A Given Year
LifeLife DIDI
Sources:Transactions. Society of ActuariesCommissioners Disability TableDeath – National Center for Health StatisticsFire & Motor Vehicle – Accident Facts. National Safety Council
Leading Edge Disability Center (888) 677-6575 www.disabilitycenter.com
Leading Edge Disability Center (888) 677-6575 www.disabilitycenter.com
Protect Your Most Protect Your Most Valuable AssetValuable Asset
Protect Your Most Protect Your Most Valuable AssetValuable Asset
CurrentCurrent AgeAge
$25,000$25,000 $35,000$35,000 $50,000$50,000 $60,000$60,000 $100,000$100,000 $125,000$125,000 $150,000$150,000
3030 875,000875,000 1,225,0001,225,000 1,750,0001,750,000 2,100,0002,100,000 3,500,0003,500,000 4,375,0004,375,000 5,250,0005,250,000
3535 750,000750,000 1,050,0001,050,000 1,500,0001,500,000 1,800,0001,800,000 3,000,0003,000,000 3,750,0003,750,000 4,500,0004,500,000
4040 625,000625,000 875,000875,000 1,250,0001,250,000 1,500,0001,500,000 2,500,0002,500,000 3,125,0003,125,000 3,750,0003,750,000
4545 500,000500,000 700,000700,000 1,000,0001,000,000 1,200,0001,200,000 2,000,0002,000,000 2,500,0002,500,000 3,000,0003,000,000
5050 375,000375,000 525,000525,000 750,000750,000 900,000900,000 1,500,0001,500,000 1,875,0001,875,000 2,250,0002,250,000
5555 250,000250,000 350,000350,000 500,000500,000 600,000600,000 1,000,0001,000,000 1,250,0001,250,000 1,500,0001,500,000
6060 125,000125,000 175,000175,000 250,000250,000 300,000300,000 500,000500,000 625,000625,000 750,000750,000
Average Income to Age 65Average Income to Age 65
Leading Edge Disability Center (888) 677-6575 www.disabilitycenter.com
Leading Edge Disability Center (888) 677-6575 www.disabilitycenter.com
Why Don’t People Buy DI?Why Don’t People Buy DI?
No one ever thinks they are going to No one ever thinks they are going to become “disabled,” which in their minds become “disabled,” which in their minds means: means:
Leading Edge Disability Center (888) 677-6575 www.disabilitycenter.com
Leading Edge Disability Center (888) 677-6575 www.disabilitycenter.com
Don’t Use “Disability”Don’t Use “Disability”Don’t Use “Disability”Don’t Use “Disability”
Propose a new phrase Propose a new phrase
–– “ “Too sick or hurt to work”Too sick or hurt to work”
Leading Edge Disability Center (888) 677-6575 www.disabilitycenter.com
Leading Edge Disability Center (888) 677-6575 www.disabilitycenter.com
UCL Major Causes of Disabilities UCL Major Causes of Disabilities 1995 - 20001995 - 2000
UCL Major Causes of Disabilities UCL Major Causes of Disabilities 1995 - 20001995 - 2000
22%
20%
13%11%
9%
7%
6%3% 3% 6%
Musculoskeletal Disorders Injury & Poisoning
Mental Disorders Cancer - All Kinds
Circulatory Disorders Genitourinary Disorders
Nervous System Disorders Digestive Disorders
Endocrine, Nutritional, Metabolic Miscellaneous
Leading Edge Disability Center (888) 677-6575 www.disabilitycenter.com
Leading Edge Disability Center (888) 677-6575 www.disabilitycenter.com
Types of DisabilitiesTypes of DisabilitiesTypes of DisabilitiesTypes of Disabilities
Total Total then partial then partial then recovered then recovered (i.e. heart attack)(i.e. heart attack)
Partial Partial then total then total then death then death(i.e. cancer)(i.e. cancer)
Partial Partial stay partial stay partial(i.e. bad back)(i.e. bad back)
Total Total stay total stay total (i.e. auto accident causing permanent paralysis)(i.e. auto accident causing permanent paralysis)
Leading Edge Disability Center (888) 677-6575 www.disabilitycenter.com
Leading Edge Disability Center (888) 677-6575 www.disabilitycenter.com
Types of DisabilitiesTypes of DisabilitiesTypes of DisabilitiesTypes of Disabilities
Dead
Proceed with caution
Proceed as normal
Leading Edge Disability Center (888) 677-6575 www.disabilitycenter.com
Leading Edge Disability Center (888) 677-6575 www.disabilitycenter.com
The Good News and Bad NewsThe Good News and Bad NewsThe Good News and Bad NewsThe Good News and Bad News
Good NewsGood News
People are People are living longer.living longer.
Bad NewsBad News
Diseases that used to Diseases that used to cause death are now cause death are now leaving people disabled.leaving people disabled.
Leading Edge Disability Center (888) 677-6575 www.disabilitycenter.com
Leading Edge Disability Center (888) 677-6575 www.disabilitycenter.com
Disability On the RiseDisability On the RiseDisability On the RiseDisability On the Rise
70%44% 36% 36%
55%
-73%
-29%-48%
-27% -32%
-100%
-80%
-60%
-40%
-20%
0%
20%
40%
60%
80%
100%
Death
Disability
Hypertension
Cerebrovascular
DiabetesAll
Four
HeartDiseases
Source: National Center for Health Statistics - 1999
DisabilityDeath
Leading Edge Disability Center (888) 677-6575 www.disabilitycenter.com
Leading Edge Disability Center (888) 677-6575 www.disabilitycenter.com
Everything Rests on IncomeEverything Rests on IncomeEverything Rests on IncomeEverything Rests on Income
Leading Edge Disability Center (888) 677-6575 www.disabilitycenter.com
Leading Edge Disability Center (888) 677-6575 www.disabilitycenter.com
Who Buys DI?Who Buys DI?Who Buys DI?Who Buys DI?
DoctorsDoctors
LawyersLawyers
Business OwnersBusiness Owners
ExecutivesExecutives
Leading Edge Disability Center (888) 677-6575 www.disabilitycenter.com
Leading Edge Disability Center (888) 677-6575 www.disabilitycenter.com
0
5
10
15
20
25
Prof. Mangers MiddleIncome
Per
cen
tag
e o
f P
enet
rati
on
Market PotentialMarket Potential
Source: Provident; Bear, Steams & Co. Inc. Report, 1998
Estimated Individual DI market size and penetration
78
Marketing OpportunityMarketing OpportunityMarketing OpportunityMarketing Opportunity
Millio
ns o
f Peo
ple
Penetration (Left scale)Market Size (Right scale)
0
5
10
15
20
Leading Edge Disability Center (888) 677-6575 www.disabilitycenter.com
Leading Edge Disability Center (888) 677-6575 www.disabilitycenter.com
0
10
20
30
40
50
60
70
80
90
Physicians Dentists Attorneys Corp. Execs Prof. Managers MiddleIncome
Pe
rce
nt
of
Pe
ne
tra
tio
n
Marketing OpportunityMarketing OpportunityMarketing OpportunityMarketing Opportunity
Individual Disability Market Penetration by ProfessionIndividual Disability Market Penetration by Profession
Source: UnumProvident; The Guide of Understanding the Life Insurance Industry Banc of America Securities Inc. 2001
Leading Edge Disability Center (888) 677-6575 www.disabilitycenter.com
Leading Edge Disability Center (888) 677-6575 www.disabilitycenter.com
Marketing OpportunityMarketing OpportunityMarketing OpportunityMarketing Opportunity
Every 1.3 seconds someone becomes a hospital patient.
Every 3.3 seconds someone is disabled for a day or longer.
Every 7.5 seconds someone is disabled in the home.
Every 15.6 seconds someone is disabled at work.
0
2
4
6
8
10
12
14
16
Likelihood of becoming disabledLikelihood of becoming disabled
Source: Jim McCarty CLU, RHU, LUTCF, Above Source: Jim McCarty CLU, RHU, LUTCF, Above the Line: Scorching Strategies for Sizzlin’ Sales the Line: Scorching Strategies for Sizzlin’ Sales Success, 1988.Success, 1988.
Leading Edge Disability Center (888) 677-6575 www.disabilitycenter.com
Leading Edge Disability Center (888) 677-6575 www.disabilitycenter.com
0%
10%
20%
30%
40%
50%
5 - 9 10 - 24 25 - 99 100 - 999
Individual Only
Group Only
Both
Number of Employees
% o
f C
om
pan
ies
Pro
vid
ing
E
mp
loye
e D
isab
ilit
y C
ove
rag
e
Marketing OpportunityMarketing OpportunityMarketing OpportunityMarketing Opportunity
Source: Response Analysis Corporation,1994
Leading Edge Disability Center (888) 677-6575 www.disabilitycenter.com
Leading Edge Disability Center (888) 677-6575 www.disabilitycenter.com
DI is discussed in only 36% of all DI is discussed in only 36% of all insurance discussions. insurance discussions.
Just ASK!Just ASK!
Source: 2000 LIMRA International, Inc.
Marketing OpportunityMarketing OpportunityMarketing OpportunityMarketing Opportunity
Leading Edge Disability Center (888) 677-6575 www.disabilitycenter.com
Leading Edge Disability Center (888) 677-6575 www.disabilitycenter.com
Top 10 Companies Selling Top 10 Companies Selling Noncancellable DINoncancellable DI
Top 10 Companies Selling Top 10 Companies Selling Noncancellable DINoncancellable DI
1. Unum/Provident1. Unum/Provident 6. IDS Life 6. IDS Life
2. Guardian Life2. Guardian Life 7. Principal 7. Principal
3. Mass Mutual Life3. Mass Mutual Life 8. Union Central 8. Union Central
4. Northwestern Mutual Life4. Northwestern Mutual Life 9. Combined of America 9. Combined of America
5. Met/NEF5. Met/NEF 10. Standard of Oregon10. Standard of Oregon
Source: 2002 LIMRA International, Inc., First quarter year-to-date. (Based on 18 participating companies.)
Leading Edge Disability Center (888) 677-6575 www.disabilitycenter.com
Leading Edge Disability Center (888) 677-6575 www.disabilitycenter.com
DedicationDedicationDedicationDedication
Union Central is dedicated to selling DI.Union Central is dedicated to selling DI.
Leading Edge Disability Center (888) 677-6575 www.disabilitycenter.com
Leading Edge Disability Center (888) 677-6575 www.disabilitycenter.com
PersistencyPersistencyPersistencyPersistency
Due to the level premium structure of Due to the level premium structure of
noncancellable DI, once a policy has noncancellable DI, once a policy has
been in force for several years, it is less been in force for several years, it is less
likely to be replaced. likely to be replaced.
Leading Edge Disability Center (888) 677-6575 www.disabilitycenter.com
Leading Edge Disability Center (888) 677-6575 www.disabilitycenter.com
Current rates at a given age for $1000 of Current rates at a given age for $1000 of
basic coverage basic coverage
AgeAge Annual Premium Annual Premium
2525 $244.90$244.90
3535 $346.80$346.80
4545 $553.90$553.90
5555 $764.30$764.30
PersistencyPersistencyPersistencyPersistency
Leading Edge Disability Center (888) 677-6575 www.disabilitycenter.com
Leading Edge Disability Center (888) 677-6575 www.disabilitycenter.com
CompensationCompensationCompensationCompensation
Disability insurance has a strong FYC Disability insurance has a strong FYC as well as an impressive renewal and as well as an impressive renewal and bonus program. bonus program.
Over time, selling DI is very profitable.Over time, selling DI is very profitable.
Leading Edge Disability Center (888) 677-6575 www.disabilitycenter.com
Leading Edge Disability Center (888) 677-6575 www.disabilitycenter.com
YearYear DI Renewal (10%) + DI Renewal (10%) + Bonus (5%)Bonus (5%)
Life Renewal Life Renewal (2%)(2%)
11 $0 $0 $0$0
22 $3,075$3,075 $600$600
33 $6,150$6,150 $1,200$1,200
44 $9,225$9,225 $1,800$1,800
55 $12,300$12,300 $2,400$2,400
66 $15,375$15,375 $3,000$3,000
77 $18,450$18,450 $3,600$3,600
88 $21,525$21,525 $4,200$4,200
99 $24,600$24,600 $4,800$4,800
1010 $27,675$27,675 $5,400$5,400
TotalTotal $138,375$138,375 $27,000$27,000
CompensationCompensationCompensationCompensation
Assumes $30,000 premium/year; 100% persistency
Note: DI and Life FYC over this time period = $150,000 each
Leading Edge Disability Center (888) 677-6575 www.disabilitycenter.com
Leading Edge Disability Center (888) 677-6575 www.disabilitycenter.com
Repeat BusinessRepeat BusinessRepeat BusinessRepeat Business
As a person’s income increases, the As a person’s income increases, the need to add more DI increases as well. need to add more DI increases as well.
Guaranteed Physical Insurance Rider Guaranteed Physical Insurance Rider (GPIR) allows your client to purchase (GPIR) allows your client to purchase those increases. those increases.
Leading Edge Disability Center (888) 677-6575 www.disabilitycenter.com
Leading Edge Disability Center (888) 677-6575 www.disabilitycenter.com
“ “While most individuals will protect themselves While most individuals will protect themselves from the loss of personal property, few consider from the loss of personal property, few consider the consequences of losing the ability to earn a the consequences of losing the ability to earn a living.”living.”
— — Associated Press Online Associated Press Online 2/992/99
Experts recommend buying DIExperts recommend buying DI Experts recommend buying DIExperts recommend buying DI
Leading Edge Disability Center (888) 677-6575 www.disabilitycenter.com
Leading Edge Disability Center (888) 677-6575 www.disabilitycenter.com
Experts recommend buying DIExperts recommend buying DI Experts recommend buying DIExperts recommend buying DI
“ “Before worrying about savings, one had better Before worrying about savings, one had better protect their income.”protect their income.” — U.S.A. Today 7/86 — U.S.A. Today 7/86
Leading Edge Disability Center (888) 677-6575 www.disabilitycenter.com
Leading Edge Disability Center (888) 677-6575 www.disabilitycenter.com
Experts recommend buying DIExperts recommend buying DI Experts recommend buying DIExperts recommend buying DI
“ “Disability insurance may be a family’s Disability insurance may be a family’s
only protection against financial ruin.”only protection against financial ruin.”
— — Wall Street Journal Wall Street Journal 12/85 12/85
Leading Edge Disability Center (888) 677-6575 www.disabilitycenter.com
Leading Edge Disability Center (888) 677-6575 www.disabilitycenter.com
Professional LiabilityProfessional LiabilityProfessional LiabilityProfessional Liability
Agents who present themselves as Agents who present themselves as
“financial planners” but don’t discuss “financial planners” but don’t discuss
DI may be held liable for uninsured DI may be held liable for uninsured
losses. losses.
Leading Edge Disability Center (888) 677-6575 www.disabilitycenter.com
Leading Edge Disability Center (888) 677-6575 www.disabilitycenter.com
ConclusionsConclusionsConclusionsConclusions
There is a need to protect people’s income.There is a need to protect people’s income.
Relatively few companies and agents areRelatively few companies and agents are
offering disability income. offering disability income.
There are great financial rewards for sellingThere are great financial rewards for selling
disability income. disability income.
Union Central has a great product.Union Central has a great product.
All you need to do is – All you need to do is – Just Ask!Just Ask!
Leading Edge Disability Center (888) 677-6575 www.disabilitycenter.com
Leading Edge Disability Center (888) 677-6575 www.disabilitycenter.com