Critical illness plans: Do you sell wants or needs?
Set yourself apart from every other agent by telling the story of critical illness plans.
As agents, we always want the best for our clients. This would include competitive pricing, outstanding benefits and the ability to purchase these benefits from a quality company. The business owner has the same needs with a little more emphasis on price. Now the quandary: Do we offer each owner the same package, the “wants”, or do we step outside and really sell the “needs”?
The following statistic should give you some insight into the state of voluntary benefits in the workplace and how they are viewed by owners:
Approximately 20 percent of employers think there is value in making voluntary benefits available to their employees and yet only 20 percent list offering voluntary products to their employees as a priority.
This statistic boggles the mind.
Selling on value, not price
How do we get business owners to see the value of these voluntary products? Which plans cover the wants and which plans really cover the needs?
What products are we showing them? As you might guess, the top products sold as voluntary products are supplemental life and disability insurance. This is true if dental and vision plans are already provided by the employer.
What will interest the business owner and have them say “Yes, we need this benefit”?
Did you get the attention of a new prospect by offering the same line of goods that every other agent showed them?
You will get the owners attention if you show a need and then fill that need.
Are the top voluntary products a need?
The top selling voluntary products are dental, vision, disability and supplemental life plans. All of these plans are very important and have their place. Which of these plans fill a need? All of them are very beneficial, but an analysis needs to be conducted with the business owner as to the value of the products you want to offer to their employees.
We are confident that an employee and business owner would agree that the most important need they have is to protect their income if they are disabled and unable to work. Why not show the true value to the owner through a short-term disability plan and a critical illness plan? You have now filled a need.
Critical illness plans: a vital voluntary product
How do I get the business owners attention to add valuable voluntary products? Show them something other than the industry norm of vision, dental, life, accident and disability. Set yourself apart from every other agent by telling the story of critical illness plans. Critical Illness plans must be presented with passion and emotion. If this is not your area of expertise, then you need to become educated about the value of these plans.
Critical illness insurance is needed by everyone. Most plans pay a lump sum cash benefit upon diagnosis of a critical illness such as cancer, heart attack and stroke. Did you know:
- While advances in medical science have significantly improved our chances of surviving heart attack, cancer, stroke or other critical illnesses, the fact remains that 75 percent of healthy individuals over the age of 40 will become critically ill at some time in the future. 1
- For those suffering a critical illness prior to age 65, the probability of surviving is almost twice that of dying. 1
I am not against vision, dental or accident products. I have to admit I have never seen a family go bankrupt due to out-of-pocket expenses from dental or vision care. Critical illness plans lag so far behind these plans it is unbelievable. Why is this? Education and perception is our thought.
Most business owners are unaware this type of plan is available. If the owner is shown the value of this coverage, they will be more responsive to offering this to their employees.
Did you know that two-thirds of bankruptcies are due to medical bills and over 78 percent of those filing had medical insurance? 2
These plans are not the cure-all, but certainly would help a family in their time of financial difficulty. A large number of agents say they offer critical illness plans as a gap-filler. That seems like taking the easy way out. All you are doing is covering a deductible and co-insurance. What about the monthly bills, the out-of-pocket medical expenses and the lost income?
If they have a disability plan, they will only receive 60 percent of their pay. Critical illness plans should be sold with a disability plan to really give full protection to those diagnosed with a critical illness. Once you run a quote, you will see that this is an affordable option.
How to determine benefit amount
How do you determine the amount a client needs? You need to take time and ask questions as to the needs of the client. I would suggest that you determine their monthly expenses, then determine their monthly income if they were unable to work. Their savings accounts should not be included in these calculations, as this is what we are trying to protect with this type of coverage.
For the benefit amount, you want to cover the deductible and co-insurance of their health plan, replace their income and project what the medical expenses will run that will not be covered by their health plan. You need to project how long the individual will be unable to earn an income. These numbers will give you a total benefit amount.
Selling with emotion
Critical illness plans need to be sold with emotion and a story. Once the appointment is set with a new prospect, you might ask what their objective is and what they think they would like to offer their employees. Listen to what they are telling you, and compliment them on having the foresight to offer those plans. I bet that they will never ask for critical illness as a benefit. Now is the time to ask why each plan they asked for is important to them and listen to their response. You are bound to hear that the owner wants to provide the best for his employees and help as much as he can with his offerings. Now is the time you should request permission to ask a couple of questions. Ask the business owner if he or she has ever had a heart attack, stroke or cancer. If they answer “no”, ask if anyone in their family or a friend has had any of those conditions. Trust me, in most cases you do not have to go further to find they have known someone with one of those conditions. Now ask how they got through it. Did they have any financial hardships? How long before they got back to work? Did they have disability insurance?
With this information, you can now present the critical illness coverage, and the first person to see that need is the business owner. The owner should be your first sale. Make that person the subject of the “what if” scenario.
“What if you had a critical illness? Who would run the business in your absence?” Explain to the business owner that with today’s modern technology, we are more likely to survive a critical illness. Sell them on the need and how it would benefit them and you will have much better participation in enrolling the employees.
Remember, critical illness is a living benefit; it helps the living.
Selling with a story
Some people may not like this suggestion, but it is the way a critical illness product needs to be sold. You need a story to tell to get the point across and get the feeling out there. The most powerful story is the delivery of a claim check, but until you have one of those, you have to draw on life experiences. Use statistics, but use them to back up your story. You are trying to convey the financial hardship people experience when they are diagnosed with a critical illness and are unable to earn a wage.
We are confident you have all either seen or been to a spaghetti benefit dinner for a family that is having financial difficulties due to a critical illness. This is a universal phenomenon and one everyone can relate to on some level. Your solution to this problem is to offer a combination of critical illness coverage and disability.
We have one last comment on the delivery of a claim check. If and when this does present itself, you must deliver the check in person. If this is impossible, you need to have a colleague deliver the check. You need to make every effort to do a face-to-face delivery. This act is often overlooked by many agents and we cannot believe this happens! You have just made a friend for life. How many times are we granted that opportunity?
Set yourself apart from other agents
The critical illness plan should be a main offering in your basket and not an “oh, by the way” product. Sure, it is going to take more time to inform the client on the benefits of this plan, but once you are comfortable with the presentation, you will receive many referrals because you set yourself apart from most other agents. Will you make more people happy by filling their wants or truly help by filling their needs? Be confident, sell with emotion and be passionate.
1 2009 Heart and Stroke Statistical Update. American Heart Association
2 First National Critical Illness Risk Assessment Study published by the American Association for Critical Illness Insurance.