Are you chasing after the wrong disability insurance prospects? You might think the person who makes the most money and who has the most discretionary income is the best candidate for individual disability insurance. While there’s some truth to this assumption, it can also lead you down a dead-end path.
Keep reading to see why the perfect prospect might not be the one you imagine.
The Missing Element
It’s true that the perfect prospect for individual disability insurance has an income that’s worth protecting. Lower-income earners might not be able to afford coverage, or they might be satisfied with the group disability insurance policy provided by their employer.
Higher-income earners, on the other hand, typically aren’t as well covered by group policies because of the benefit caps that these policies have. To fully protect their income, they need to add a supplemental individual disability insurance policy.
But this is only part of the picture. There’s another key component you need to identify before you can spot the perfect prospect.
Spot the Perfect Prospect
Looking at the following options, who do you think needs paycheck protection?
- Someone who owns a lot of real estate
- A professional athlete
- A person with a trust fund
- A business owner
If you answered all of the above, you’re right – and wrong. While it’s true that everyone listed here could be an excellent candidate for individual disability insurance, some of these prospects might not want or need it.
Why?
Because they don’t depend on a paycheck.
Individual disability insurance is for people who depend on a paycheck. If your prospects have so much enough passive income or wealth that they don’t rely on a paycheck, then they probably don’t need paycheck protection, either.
Finding the Sweet Spot
To find the perfect individual disability insurance, you need to find someone who relies on a paycheck but who can also afford a policy.
Identifying this sweet spot can be tricky. If you go too far to one end, you’ll have candidates whose paychecks barely cover basic necessities – there’s simply nothing to spare for insurance. And if you go too far to the other end, you’ll have candidates who have enough wealth that they’d be financially stable if they never earned another paycheck again.
You need someone in the middle, someone who’s lifestyle depends on a steady paycheck but who has a flexible enough budget to afford premiums. This is the perfect prospect. Typically, it will be someone who earns at least $50,000 but who isn’t independently wealthy.
But of course, no prospect is truly perfect. Each person you meet with is unique. Some people will want top-shelf policies with all the bells and whistles. Others will only be able to afford a bare bones policy. This is why it’s important to consider each individual’s budget and needs, and to offer a policy that fits.
To learn more about identifying your perfect individual disability insurance prospect, download this guide.