This October, we’re taking a closer look at critical illness insurance - and easy ways to get started selling it.
A critical illness policy pays your client a lump sum of cash if they’re diagnosed with a serious illness. Carriers define which illnesses are covered by the policy, such as heart attack, stroke, Alzheimer’s, organ transplant, and life-threatening cancer. Some policies will also pay out in varying amounts on less serious conditions like blindness, deafness, coronary artery bypass surgery, and more. Depending on the carrier, there may also be a return-of-premium option.
It’s often easier for clients to have a conversation about critical illness than it is for them to talk about life insurance. After all, most people know someone who’s been affected by heart attack or cancer. It’s not a stretch to ask someone if they’re worried about paying bills when they get sick.
Why Your Clients Need Critical Illness Insurance
Health insurance costs are rising. “Affordable” plans often have deductibles in the thousands, which reset (and often increase) every calendar year.
According to the New York Times, nearly a third of large employers ONLY offer high-deductible plans – that’s more than ever before. Compare that percentage to 2010, when only 10% of large employers exclusively offered this type of plan.
4 in 10 adults have skipped some kind of health care due to the cost.
High-deductible plans make your client pay for all medical expenses up to the deductible, after which they have to pay a percentage of care (called coinsurance, ranging from 10 to 40%). Deductibles range from $2,000 to $5,000, with an average of $1,218 (Kaiser Family Foundation’s Employer Health Benefits, 2014 Annual Survey: Employee Cost Sharing). Over the past 8 years, the average deductible has doubled.
Out-of-pocket maximums can be as high as $12,900 (per the Affordable Care Act), and that doesn’t include any premiums or charges for out-of-network services your client might pay.
Americans already pay more out-of-pocket health care costs than any other industrialized country, according to the Commonwealth Fund. High out-of-pocket costs have two negative effects on your clients:
- they may skip going to the doctor or filling necessary prescriptions
- they may pay for the care they need but be unable to save for retirement as a result
Sara R. Collins of the Commonwealth Fund sums it all up: “Most health care costs are incurred by very sick patients, often under emergency conditions.”
What kinds of illnesses do very sick patients have? The same kinds of illnesses covered by critical illness insurance.
Get Started Selling Critical Illness Insurance
We’ve put together a free sales kit to help you get started selling critical illness insurance. Click here to download the kit – it’s got ideal client profiles and flyers you can email to clients who fit that profile. You can also grab some of the statistics from the first section of this post and share them on social media to get the conversation started. Then, once you need a quote, just click here to use our easy online quote request form.
So who should you look for in your book of business? Start by looking for prospects with:
- High-risk jobs that disqualify them from disability coverage
- High-deductible health insurance plans
- Their own businesses – self-employed folks are often underinsured
Next, use the conversation starters in our sales kit to help them understand what critical illness insurance is. Here are a few features you’ll probably want to highlight:
- Coverage for spouses and kids available, too
- Portable coverage that belongs to your client, not an employer
- No need to submit receipts or justify expenses – the cash is no-questions-asked
Average hourly wages are nearly the same as they were 50 years ago, when adjusted for today’s dollars. But healthcare spending zoomed from 5% to 17% of US GDP in the same time period.
And here’s the best part. When a prospect asks what they can do with the cash, all you need is one word – anything. They can:
- Pay bills
- Pay the health insurance deductible or co-insurance
- Pay for travel – maybe to a specialty clinic or even another country
- Pay for experimental treatments or medications not covered by insurance
- Pay for a vacation to ease stress
- Pay to bring faraway family members nearby during a trying time
Of course, there are a few things you want to cover with prospects first. Pre-existing conditions aren’t going to be covered, for example, and if the illness is something that recurs, the policy may have an exclusion or suspension for recurrences. Overall, this type of policy can really help families whose savings would be tapped out just by paying their health insurance deductible.
Ready to get started? Here's a no-brainer quick-start guide:
- Download our sales kit
- Check out the ideal client profiles inside
- Match that criteria with folks in your book of business
- Reach out to them with the flyers and stats provided in the sales kit
- Circle back with us to request a quote when they're interested. Easy, right?