High Percentage Selling Q&A
MGIS experts Keith Mangrum, Senior Regional Vice President of Sales, and Mark Chai, Regional Vice President of Sales, dig into how to best position and sell supplemental physician group LTD coverage.
Q: What is the single most important factor in getting a physician’s interest during the initial conversation about group LTD coverage?
Mangrum: The first thing that gets their interest is helping them understand that group disability coverage pays them in addition to their individual disability insurance (IDI). Many doctors may not know this, so once they grasp the supplemental- coverage idea—“Okay, you are not trying to replace my individual coverage and you are saying I can actually get $10,000 or $15,000 in addi- tional coverage”—now they are interested, now we have their attention. That’s the first step.
The second step in grabbing their interest is to explain that that they can be protected by group coverage that’s similar to what their individual disability plan offers. The conversation might go something like this: “So you are saying I can get these benefits in a group policy? I didn’t think I could get supplemental coverage, so that’s good. Now you are telling me that the way the formula is set up I am going to get the benefit I am expecting and other meaningful group benefits, such as receiving benefits in my 60s if I became disabled?” Yes and yes.
Q: How does the Group LTD program stack up compared to IDI? So if I’m a doctor and an individual in a group, what comes first?
Mangrum: Well, you may want to get your individ- ual coverage in place first and then stack group coverage on top. But regardless of what comes first, you need to know your IDI carrier and your group carrier are going to pay independently of each other. Our coverage is supplemental … that’s the key phrase. Supplemental coverage appeals to physicians on a personal level; group does not. To them group coverage means it’s for their employ- ees, and physicians have a different mindset than employees when it comes to physician group LTD coverage.
When you buy an IDI policy it typically asks on the application, “Do you have any other disability coverage?” If you say no, then the application may indicate, “Okay, based on your income and your health we will offer you $X amount in cover- age.” Let’s say you’re offered $15,000 IDI based on your income and down the road you buy a group policy. Well, that $15,000 individual policy is yours to keep. There is no offset.
Having a physician group LTD policy in place before IDI may affect what an IDI carrier is willing to offer, so that’s why it can be important to have IDI cover- age in place before adding Group LTD.
Q: Speaking of individual coverage, how do physicians typically acquire their individual plans?
Chai: My sister is a doctor and my cousin is an anesthesiologist. What typically happens during residency is the union affiliated with their schools offers them an association plan that gives them, for instance, $4,000 of individual coverage. Right out of school they take advantage of this offer because they want to protect their student loans.
Typically all doctors in group practices invest in IDI policies, and that’s why brokers have to change the selling conversation to one that focuses on supplemental group coverage. Doctors are sold IDI when they start meeting brokers and agents, who by the way can make 80-90% commission on these IDI policies. It’s a one-year lump sum commission, so the IDI agent wants to sell that policy because it’s a huge commission check.
It’s true that individual coverage is very important. In fact, I would recommend every doctor have individual coverage. But that’s why there’s a psychology of a doctor thinking, “Oh, employee benefits. That’s for my staff, and my IDI policy is strong.”
What makes our physician LTD policy unique is that it’s a highly differentiated group product that can be compared to individual coverage, but offers physician-specific provisions.
And it’s this crucial distinction that completely changes the selling conversation for brokers.
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