Advisers need to stop selling short term income protection (IP) plans as the default option as the average length of an IP claim lasts longer than the shortest plan on the market.
This is according to The Protection Coach, Matt Chapman (pictured), who addressed an online audience on the first day of Income Protection Action Week.
Six actionable steps
Chapman outlined six actionable steps for advisers to increase IP sales.
They include:
- Running an income stress test where clients are asked what their life would look like if their income stopped over a period of time, whether their income is guaranteed for that duration and what losing their income would actually mean to them.
- Challenging premium bias as whether an adviser thinks the cover is cheap or expensive is irrelevant as it is what the client thinks that matters.
- Anchoring value to a client’s lifestyle and resisting talking in abstract numbers.
- Leading conversations with conviction
- Speaking in a more positive, aspirational way
- Stopping leading conversations with short term IP.
Taking the easy option
“Short term has its place, but let’s be honest, too many advisers use it as the easy option,” Chapman said.
“Sometimes they can quickly use it to get a yes and then move on.”
Flipping the conversation
Chapman called on advisers to flip the conversation around.
“Make full term protection your default position,” he continued.
“Position short term as the compromise, the fall back and the last resort, but only if the client is prepared to make compromises.”
Chapman added it was not about whether advisers can talk about full term cover, but whether they can convince customers they do not need it.
“Because if you make short term the starting point, you’ll always sell short term and if you make full term the standard, you’d be amazed how many clients step up to it.”