Don’t Wait For Clients To Declare Their Personal State Of Emergency

By Kenny Russell

We continue to watch an unprecedented time in the economy with the 10-year Treasury rate at an all-time low and the stock market on a daily rollercoaster over fears of COVID-19 coronavirus sweeping the globe. We are watching an economy that is fighting through hard times. But with enough time and calmer heads, we will see markets return to normal levels and the economy begin to recover.

What if we weren’t talking about the economy but instead we were talking about your clients and their ability to go to work? We’ve heard about countries that have implemented mandatory quarantine of millions, and now cities and states in the U.S. are declaring a state of emergency, quarantines, curfews and other restrictions.

What do you think is happening to jobs and incomes? How does a family survive during this hard time? The fortunate news is that it’s temporary … just like New York City after the 9/11 attacks where travel stopped into the city, and much of the country. Travel ultimately recovered and the economy returned to normal levels.

What if this reduction in work or perhaps a permanent work stoppage was due to an injury or sickness? With the fears of negative economic outcomes of individuals in these effected areas, shouldn’t we begin to discuss the real concern for long-term disability and how to protect families?

What Are The Odds?

Think about it, a 35-year-old has a 50% chance of becoming disabled for a 90-day period or longer before they reach the age of 65. That’s a 50% chance! Thirty percent of Americans between the ages of 35 and 65 will suffer a disability during their working careers. These are frightening statistics! How do we protect everyone’s incomes?

Income Protection Insurance Is An Answer

We must include income protection insurance (disability income insurance) in every discussion that we have with clients! Financial professionals are the link to protect clients and their families in the event that they are too sick or too hurt to go to work. We cannot wait for people to declare a personal “state of emergency” because of an injury of sickness.

Here are some talking points to help you discuss income protection with your clients.

Probe for needs and priorities: Ask clients how important their income is to them and what they use that income for. How would their family and/or lifestyle be affected if that income stopped - even for 90 days, six months or three years? How long would their savings support their family if they were unable to work due to injury or sickness?
Share eye-opening facts: Remind clients that the chance of a disability for a 35-year-old prior to age 65 is 50%, and the chance of a disability for all clients who are currently between ages 35 and 65 is 30% overall. Point out that the average period of time a disability claim lasts is just short of three years.
Use relatable comparisons: Premiums for car insurance are comparable to premiums for income protection, but car insurance covers only the value of a car. Look at the value of income for relatively the same premium. (Income x three years = potential average benefit value compared to auto insurance.)
Point out gaps: Group coverage is a good start but it has limitations on earnings and benefits. The worst time for your client to find out about that is when they are on claim. Most of those who have group insurance believe it covers them long term and has full benefits. It’s a good place to start the conversation!

Disability insurance serves to guard against illness or injury resulting in loss of income for a period of time. It’s income protection that can help during good or bad economic times. There’s no better time than now to have the conversation with your clients.

Kenny Russell is director, disability sales, for the Disability Solution Center at Crump Life Insurance Services. Kenny may be contacted at [email protected].