Attitude The Shoe Salesman
What is Critical Illness Insurance? It Pays a Lump Sum Benefit on the Diagnosis of a Covered Condition
Purpose Critical Illness Insurance was created to Remove Financial Stress so that the Person can Focus on Recovery It’s About Survival
Opportunity We believe Critical Illness is the best opportunity our generation will have in the insurance business
Opportunity • Meets A Need Not Met by any Other Product • Makes a Difference in People’s Lives • No One Owns It - Everyone is a Prospect • Sets You Apart
History of Critical Illness • Developed by Dr Marcus Barnard • Originated in South Africa in 1983 • Introduced in: • England 1987 • Australia 1990 • Japan 1993 • Canada 1994 • US 1999
Successful In Every Country • Takes 5-7 years before sales start to develop • Sales Ideas are transferable • 20 years of Sales Ideas
Claims Experience UK Claims Paid AgeMaleFemale Under 40 33% 45% 41-50 35% 35% 51-60 23% 14% Over 61 9% 6% Average Age of Claims Paid: 43
Who Do You Know? • Ask your clients: • “Who do you know?” • “Who do you know that’s had a heart attack, cancer or stroke?” • “Who planned to be on that list?” • “Who on your list could’ve used $25,000, $50,000 or $100,000?” • “How would they have used that money?”
Medical Advances have changed our lives and are changing our world • Due to medical advancements: • People are living longer • More critical illnesses are being diagnosed • People are surviving critical illnesses • Survival has a price
Why there are more Critical Illnesses such as Cancer, Heart Attack and Strokes today?
Leading Causes of Death in 1900 • Pneumonia 12 % • Tuberculosis 11 % • Enteritis 8 % Source: The Wall Street Journal, 08/27/01
People are living longer Average Life Expectancy 1900 - 47.3 2001 - 77.2 Source: National Center for Health Statistics 2002
Lifestyles – Today We • Diet • Smoke (Some of Us) • Work more • Sleep less • Rush The Result: More Stress
What are the odds? • In the United States • Every 29 seconds, someone suffers a coronary event1 • Every 45 seconds, someone suffers a stroke 1 • About 1.3 million new cancer cases are expected to be diagnosed in 2003 2 1 Heart Disease & Stroke Statistics - 2003 Update: American Heart Association 2 2003 Cancer Facts & Figures, American Cancer Society
Critical Illness Insurance Your chances of surviving are better than ever... 2000 Heart and Stroke Statistical Update, American Heart Association 2000 Cancer Facts & Figures, American Cancer Society
Critical Illness Insurance Surviving has a price... Source: 2002 Cancer Facts & Figures, American Cancer Society
Survival Has a Price • Indirect Expenses • Loss of income for self and / or spouse • Home modifications • Experimental treatment • Child care and domestic assistance • Transportation and lodging for family members and caregivers during treatment
Survival has a price • Critical illness insurance meets a need • not met by: • Medical Insurance • Life Insurance • Disability Income
Type of Critical Illness Insurance • Rider On a Life Policy • Stand Alone Health Policy
Simplified Critical Illness Covered Conditions and Definitions Life-Threatening Cancer Heart Attack Stroke Major Organ Transplant (when registered with United Network Organ Sharing/UNOS) Alzheimer’s Disease Paralysis Renal (kidney) Failure Coma Major Burns As defined by the policy. May vary by state. Exclusions & limitations apply.
Simplified Critical Illness Pays 25% of Maximum Benefit • When you are diagnosed or require: • Cancer in-situ • Bypass Surgery • Pays 10% of the maximum benefit for Angioplasty As defined by the policy. May vary by state. Exclusions & limitations apply.
Return of Premium Death Benefit If you die while your policy is in force, you can receive: • 100% of the premiums paid minus any claims or • The benefit amount (if from a covered condition)
Optional Benefits Return of Premium Rider In the event you survive and do not have a covered condition, you can receive 100% of the premiums you’ve paid at age 75 The Return of Premium rider provides increasing percentages beginning in the 5th year.
Optional Benefits Spouse Rider – can purchase any amount not to exceed primary insured Children’s Rider – amounts of $5,000 or $10,000 Waiver of Premium – total disability, 6 month elimination period – retroactive benefits Accidental Death Benefit – any amount up to the maximum benefit amount
Personal Needs Analysis: • If you were diagnosed with cancer or suffered a heart attack or stroke, would you want all or part of your mortgage balance paid off? What amount would meet your needs? • In the event of a critical illness, would you want your credit card or other lines of credit paid in full? What amount would meet your needs? • In the event of a critical illness, would you want to make sure that all of your other financial obligations are met? What amount would meet your needs? $ $ $ $ Total
Underwriting – Simplified • Must Answer Questions “No” • Must Be Within Build Guidelines
Underwriting - Simplified Build Guidelines
Underwriting - Simplified • Tobacco Question - • Has the proposed insured(s) used any tobacco or nicotine during the past 12 months?
Underwriting - Simplified Family History Have any two or more of the Proposed Insured’s natural parents, brothers or sisters, either living or deceased, been diagnosed with the same condition(s) from the following list: • Heart disease, stroke, diabetes, kidney disease or breast cancer prior to age 60? • Colorectal cancer or Alzheimer’s or Senile Dementia prior to age 75? • Any other same cancer in both relatives prior to age 55?
Underwriting - Simplified • MIB • Telephone Inspection • Telephone Inspection every 25th App
Critical Illness Covered Conditions • Major Burns • Coma • Deafness • Kidney Failure • Blindness • Aortic Surgery • Loss of Speech • Cancer • Heat Attack • Stroke • Major Organ Transplant (UNOS) • Benign Brain Tumor • Motor Neuron Disease • Advanced Alzheimer's • Heart Valve Replacement
Critical Illness Covered Conditions • Cancer in situ – 25% - $25,000 maximum • Bypass Angioplasty – 25% - $25,000 maximum
UnderwritingCritical Illness Similar to Preferred Life Some Differences
UnderwritingCritical Illness Mortality vs. Incidence
UnderwritingCritical Illness Your client is not eligible for CI if there is a prior history of: • Cancer (some exceptions)* • Diabetes (insulin dependent or uncontrolled) • Heart Disease, including heart attack, angina, vascular surgery or angioplasty • Major Organ Transplant • AIDS, HIV+ • Alcohol Abuse, treated within past 2 years • Drug Abuse • Stroke or Transient Ischemic Attack (TIA) • Kidney Failure or Disease (other than kidney stone) • Cystic Fibrosis • Hepatitis other than A Multiple Sclerosis • Muscular Dystrophy Huntington’s Chorea • Permanent Paralysis Systemic Lupus Erythematosus • Alzheimer’s Disease Amyotrophic Lateral Sclerosis *applicants with certain cancers, including skin cancers other than melanoma or certain early state cancers, may still be eligible for coverage.
UnderwritingCritical Illness Occupational Consideration
UnderwritingFinancial Guidelines • 7 times earned income up to $250,000 • 6 times earned income up to $500,000 • Nonworking spouse: 50% of working spouse limit up to maximum of $250,000
UnderwritingFamily History Based on Immediate Family Members – Natural Parents, Brothers or Sisters
UnderwritingFamily History Has any Immediate Family Member suffered from Cancer (specify type), Motor Neuron disease, Alzheimer’s Disease, or other hereditary disease prior to age 65?
How do you Sell Critical Illness • Forget the Statistics • Doctors and good medicine created the problem • People survive today! 50 years ago they would have died • A Doctor created the Solution • You need to help the client with options to attach the dollars • ex. Mortgage, replacement of income, etc. • Personal Debt
Prospecting Your existing Clients are the Best Prospects Who Are Some Other Prospects?
Return of Premium Approach • When was the last time your car insurance gave you money back when you didn’t have a claim? • When was the last time your homeowners insurance gave you money back if you didn’t have a claim? • I have a special type of insurance that gives you all your money back. Would that interest you?
Presenting Critical Illness • Organized Presentation • Who do you know? • Are you covered? • Claims examples • Video • Consumer PowerPoint
If you knew you were going to be diagnosed with cancer in the next 6 months, would you buy this? How do you know you won’t?