Posts Tagged ‘Disability’

Insurancenewsnet.com recently published excerpts from a recent LIMRA report  which surveyed executives at leading insurance companies, which at first glance does not look very promising.  http://insurancenewsnet.com/article.aspx?id=243651&type=topnews

But as marketers of life insurance products through the association / affinity channel, the news may not be as dire.  The middle market and bank market has continued to grow and the majority of those surveyed felt this trend will continue.  The challenge for marketers is how to reach that middle market, particularly in a direct response model.  Organizations that cater to this market are prime candidates for business relationships.

We would like to hear from you: what market segments are you finding success with life insurance sales and what products are most successful?

A business like an automobile, has to be driven, in order to get results-B.C. Forbes

George Bode

In Part One of “Cross Selling: Are You Maximizing Your Potential”, we focused on the value of the “welcome call” when trying to cross sell or upsell/upgrade a new insured.  In this post we will discuss the value of statement stuffers and “on bill”  offers for cross selling.  We are working off the premise that every billing statement presents a very cost effective opportunity to market additional products; therefore,  a billing stuffer in every premium notice. We are all very aware that retention levels increase when insureds have multiple lines of coverage.

Statement stuffers for purposes of this discussion will be defined as pieces included in the billing statement that has a description of  the product being offered with a specific marketing message, an offer, a call to action and a  form or application that needs to be filled out and returned  for underwriting or activation of coverage.  Statement stuffers can be used with both guarantee issue and underwritten products. 

“On bill” offers take advantage of technology and includes the product being cross sold on the bill with the new benefit and additional premium illustrated-the call to action is for the insured to check a box to opt for the coverage and  sign the bill,  and pay the additional premium.  Coverage is  automatically then  issued.  A letter describing the product should be used, and this type of offer will only work with guarantee issue products since the insured is activating coverage directly on the bill by checking the box and paying the additional premium.  On bill offers have greater success due to the ease and customization of the offer; however, when cross selling it does limit the products that can be sold do to the fact that the product must be guarantee issue.

What we like to refer to as the “marketing triumvirate”, that is: the ”list” is the most import indicator of a successful campaign, followed by “the offer” , and finally “creative”, applies to cross selling as well.  The good news is, when cross selling to existing insureds, you have the perfect list–they are already a customer, you know what coverages they have already, and you have all the pertinent information to make a meaningful offer.

Therefore, cross sell offers should really compliment the product that is being billed.  For instance, Business Overhead Expense, is a product that naturally cross sells well to a disability insured.  The copy should clearly explain the difference between business expenses and personal expenses, and how both policies can cover both exposures.  As with any direct marketing piece, the greater the customization to the recipient, e.g., premium illustrated based on insureds age, the greater the response.   In the previous post we provide other examples of logical cross sell products.

Finally, if your budget permits-consider testing your creative-color pieces vs. black and white, or pieces with and without pictures, etc., you may find it has little or no impact on response, or your groups may respond better to different creative.  Bottom line is the offer is the most important element you can control.  Therefore, be sure to make a meaningful offer with a clear call to action.

While we advocate cross selling with every billing statement, you will obviously need to change offers and products offered to ensure freshness in your approach.  You are also in a great position since  you are in control of the  “list” to ensure meaningful benefits are presented, thus greater increasing your chances for success.

We would be happy to speak to you further about cross selling or other marketing ideas.  Please feel free to comment on this post with any information that may be helpful to the other readers.

Please be sure to check back for Part 3 which will focus on “upselling / upgrading”.

George Bode

Plan the sale when you plan the ad – Leo Burnett

As insurance professionals we have a duty and obligation to ensure our clients are properly protected from risks that can have devastating impacts on themselves, their businesses and their families.  As consumers we are all very sensitive to insuring our, home, auto, health, and life, but all too often we do not consider insuring our ability to earn a living.  Insurance professionals have generally done a very good job at presenting and selling disability insurance either through the employer, the individual market, or the group association market.  While disability insurance helps to replace income when an individual cannot work due to a disability, this benefit is intended to provide a monthly benefit to cover the expenses of managing the household, groceries, mortgage payments, utilities etc. 

What happens if the individual is also a business owner or a partner in a business and they become disabled?  How is payroll met, rent and utlities paid, equipment leases paid?  These expenses do not suddenly disappear in the event of a disability, therefore, they must be paid, or the business could face bankruptcy.  There is a highly effective product called Business Overhead Expense coverage, which is in essence a disability policy to cover the expenses associated with running a business.  Physicians,  attorneys, dentists, CPAs, have traditionally been key professions that have seen the value in Business Overhead Expense.  Unfortunately, our experience indicates that insurance professionals have gotten away from selling this valuable product, and we are challenging the market to take a closer look and consider presenting and selling this valuable product again.

If you have book of individual or association group disability this is a great place to start with a fairly simple cross sell.  You need to explain the need to your customer  in the easiest of terms: you have insured your household in the event of a disability, you now need to ensure your business in the event of a disability.  Disability and Business Overhead are two separate and distinct policies that will cover the same disability and should be explained and treated as such.

Business Overhead Expense coverage is tax deductible in most cases making it even a greater value.

Are you currently offering Business Overhead Expense coverage?  What strategies are working?  We would like to hear from you.

If you are interested in learning more about Business Overhead Expense coverage including marketing and sales strategies, please contact us at Cranbury Professional Services

George Bode

I have not failed. I’ve just found 10,000 ways that won’t work.

Thomas A. Edison

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