Tips from the Insurance Pros with Jeff Peterson
Hello and welcome to Assurity’s podcast, Tips from the Insurance Pros. In this series, we talk with insurance pros as they share ideas and insights that you can use today. I'm your host Matt, and I'm excited to bring you a new topic for this month: Disability income insurance. Assurity has been a leader in income protection for decades, dating back to 1890. We're committed to the market and to your sales success. That's why we're excited to have disability insurance expert of more than 18 years, Jeff Peterson, with us today. Jeff is the president and CEO of Truluma. He'll be sharing his considerable experience leading a successful brokerage focused on DI. Welcome, Jeff, it's great to have you here with us today.
Jeff Peterson (00:51):
Matt, thanks for having me and thanks for providing a platform to talk about income protection.
Absolutely. It's an important topic. Can you tell us a little bit more about your background and company?
Jeff Peterson (01:03):
I've been in the insurance business since 1991 when I started as a career agent with Connecticut Mutual and was in personal production for about 11 or 12 years. While in personal production, I did a lot of work in the disability space and through a series of circumstances found myself in a position to move into a wholesaling type of role, which I did when we formed Truluma and now act as a one stop DI shop for advisors. So to help them find the appropriate income protection products for their clients.
Fantastic. So how do you go about educating producers on how to approach perspective clients about the need for income protection?
Jeff Peterson (01:50):
We do a lot of web-based training, small group training sessions, individual meetings with advisors to talk to them about their business and their clientele to see how they can incorporate DI into the conversations that they're having with clients. But it is interesting because as we meet with advisors that have conversations about income protection, what we find is that most of them are actually currently having conversations about income protection, although they may not realize it. They're talking to clients about life insurance and while life insurance has many uses, at the end of the day, the majority of people purchase life insurance to replace their income should they die or pass away prematurely. The problem is that this only covers half of the income risk clients are exposed to greater risk as we all are aware of is the financial aid emotional devastation that is caused by a disability. So once advisors see at the entire income protection picture, it's typically only a small or a few small tweaks they need to make to the conversations that they're having with clients to connect the life and DI or disability insurance together to create a comprehensive income protection program.
Sometimes producers focus on doctors, lawyers, and other professionals for disability income insurance. Can you talk about the need for income protection that's out there for everyone, not just white-collar groups?
Jeff Peterson (03:16):
You know, I think it's important for anybody and everyone who relies on their there on their income. There was a recent study done by CareerBuilder that found that 78% of full time workers live paycheck to paycheck. And I think that's fascinating about this is that it includes individuals that are earning six figure incomes and other survey by BankRate shows that only 23% of respondents with incomes over $150,000 per year had less than a thousand dollars in the emergency reserve fund. So that, but the point is is regardless of what someone does or how much they earn and would be putting in a very difficult financial situation should an injury or illness prevent them from working.
Sure. Now, no matter what you say, there are always going to be objections. Do you think that the objections to disability insurance have changed over the years and how do you help producers address objections when trying to sell disability income insurance?
Jeff Peterson (04:14):
You know, I sold my first disability policy over 20 years ago and the objections I saw then are the same as the objections we see now. There really hasn't been much of a change. The most common objection that we tend to see is that of price or cost. And there are some tools that advisors can use to combat this. I think getting a budget from clients is very important because it allows the advisor to design a program that is affordable for the client. We always use percentage of income when talking about cost or premium. So you know the typical income replacement type of plan is going to run somewhere between one and three percent of an individual's annual earnings. And then also, it's very helpful if advisors can compare the monthly premium to you, the annual benefit or the total potential benefit that a policy may pay out. So comparing that smaller number to the much larger number that the insured may receive.
Now, what tips do you provide producers to help them get their DIY applications through underwriting?
Jeff Peterson (05:49):
That's a great question. Advisers, if they could do some field underwriting, it's certainly very valuable and to a certain extent a bit of a loss start. What we find is that it not only saves time and effort during the underwriting process that also can make placing policies easier. Should the underwriting decision come back with an exclusion or some type of modification because those can be discussed up front so the client's aware of it and almost expecting it when the policy comes back. Always encourage advisors to take the time to complete the application, answer all the questions and provide detailed again, say it's a lot of time and headaches and then lastly, get in the habit of asking for tax returns. As the general rule of thumb. I always ask for complete copies of the last two years’ worth of tax returns. Sometimes it's not needed, but it's good to get in that habit.
Great. What's one piece of advice that you would share about how to sell more disability income insurance?
Jeff Peterson (06:53):
The key here is to ask, ask, ask, ask him and ask again and ask everyone that you talk to. Most advisors just don't bring it up and that's why they don't sell it. So you don't have to have a polished script or be an expert on disability insurance. But if you start asking questions about income replacement and what would happen, can the event to an illness or injury doors open and a lot of cases are swollen.
Well, let's go back to talking about prospective clients. How do you help producers talk to small business owners in particular?
Jeff Peterson (07:32):
The small business owners are unique obviously, and they also have many needs. There's certainly the need of replacing their income should they become sick or hurt and able to run the business. Sometimes business owners feel that if they were not able to work that the business itself continues to run. And one of the questions that I often will ask if we get that response, you know, the business runs itself, it doesn't really need me. It's all then why do you come in every single day at six o'clock in the morning and stick around here until six o'clock at night? It's a shot of reality. And the fact is that the business runs because the business owners, so also overhead expense can be a nice conversation to have with these small business owners. So should you not be able to come in and run the business? How are we going to keep the doors open and with those overhead expense policies that can cover the fixed expenses. A lot of business owners liked that concept.
So aside from small business owners are white collar markets. Are there any other markets that you specifically like to focus on? You earlier mentioned the need for everybody to look at disability insurance. Are there any niches that you like to look for?
Jeff Peterson (08:46):
Yeah, we have advisors that work and all kinds of different niches. Doctors, dentists, the attorneys, you know, three them are obvious ones. Veterinarians, hygienists, engineers. We have worked with folks who work primarily with contractors, so it's really across the board. But I think what it comes down to is you know, what type of markets do advisors have and then how can we go about developing those markets and finding, you know, those are the key triggers that get people really thinking about income protection.
Well Jeff, thank you for joining us today. We appreciate you taking the time to talk about the important role of disability income insurance. Thank you for giving me the platform and to our listeners, thanks for tuning into Assurity’s podcast series, Tips from the Insurance Pros. Stay tuned for our next episode to get more ideas on successfully selling disability income insurance. In the meantime, if you'd like to learn more about Assurity’s disability income insurance product, head over to AssurityDI.com. You can also email us email@example.com and we'll be happy to connect you with one of our regional reps in your area to take a deeper dive. Thanks for listening.
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