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OBJECTION HANDLING.

OBJECTION HANDLING. TIPS FOR FINANCIAL ADVISERS. This is not a consumer advertisement. It is intended for professional financial advisers and should not be relied upon by private customers or any other persons. DEADLINE TO THE BREADLINE CAMPAIGN.

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OBJECTION HANDLING.

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  1. OBJECTION HANDLING. TIPS FOR FINANCIAL ADVISERS. This is not a consumer advertisement. It is intended for professional financial advisers and should not be relied upon by private customers or any other persons.

  2. DEADLINE TO THE BREADLINE CAMPAIGN. • We believe most of our customers or clients don’t realise just how quickly their money could run out if anything happened to them or their partners and they had to rely on their savings. Our research shows that, on average, people in Great Britain could have as little 19 days before their savings run out if they were unable to work due to an accident or illness. • Helping establish the need for protection • Our Deadline to the breadline calculator can help your clients understand how many weeks they could have until they could be on the breadline. It might help them realise the need to consider getting some cover in place now.

  3. HELP AND SUPPORT. • We all know an effective fact find is key to truly understanding your clients and ensuring you can give them best financial advice. It’s just as important to find out what a client WANTS to spend money on, as it is about establishing what they HAVE to spend money on. • The following tips are designed to help you overcome some typical client objections. • If you would like any further support, free training sessions or help why not contact us on: • IFA Protection Sales Team 0845 273 0010. • We may record and monitor calls. Call charges will vary.

  4. TYPICAL OBJECTIONS. • Claims – Insurers don’t pay out! • 'I've heard that the claims process is long and complicated • It wont happen to me - Death, sickness, injury or disability • State will pay – if I die or get sick. • I already have Insurance protection / already got it – so no need   • I’ve got cover through work/my work will pay death in service or sick pay • Cost – I can’t afford it? • 8. Cost- its cheaper on line

  5. TYPICAL OBJECTIONS. • 9. Time - I haven't got time to consider protection insurance at the moment I just want the mortgage sorted • 10. Partner – I need to discuss it with my partner first • 11. Don't need it – I’m single, no kids and not married I’d use my savings if I got sick? • 12. Don’t need life cover, my family / the godparents said they would look after the kids if anything bad happened! • 13. Savings - I’d use my savings if I got sick • 14. I’m only renting so I don’t need illness / critical illness cover? • 15. Don't need it - If I / we got sick or died we would just sell the house/flat and downsize • 16. Don't need it - My estate won’t owe any inheritance tax?

  6. 1. CLAIMS – INSURERS DON'T PAY OUT! Slide 1 of 2 • 1) Suggested ideas /answer: • There have been cases where policies haven’t paid out, but the amount of claims paid is higher than ever: Claim Statistics – Legal & General • Paid over £1 billion in CIC claims since 2003. • £264 million in life claims in 2011, average £48,830 • £177 million in CIC claims in 2011, average £63,573 • 2) Suggested ideas /answer: • The best way to help ensure any future claim is paid is to make sure youtell us everything about your medical history, no matter how small. This helps to reduce the amount of rejected claims and to eradicate ‘Non-disclosure’ which is the main reason policies are not paid.

  7. 1. CLAIMS – INSURERS DON'T PAY OUT! Slide 2 of 2 • 3) Suggested ideas /answer: • To help reduce your risk I only recommend a name you can trust: • - Legal & General is the UK’s Number one*term assurance provider - Founded in 1836, they have over 175 years of experience - As of 30 June 2012, they have over seven million customers in the UK for their life assurance, pensions, investments and general insurance plans. - Latest Technology, OLP Connect – they use the latest technology to complete your application online. This interactive system only asks for extra medical information based on the answers you provide, helping to ensure that all relevant medical information is captured upfront. This means that more claims can be paid as nothing has been left out in error - Keeping you in the know – acopy of your application is now sent to your home address to give you the chance to correct or add anything on your application to ensure accuracy - MUTAL – L&Gs Medical Underwriting Technical Advice Line gives us access to their expert underwriters, so we can discuss your insurance needs / medical history before the application form is submitted. This helps to get you the best terms a quicker decision. *Swiss Re Term & Health Watch Report 2012, based on new individual Term Assurance sales 2011

  8. 2. I’ve heard that the claims process is long and complicated'. • Suggested ideas /answer: • To help make life easier and the claims process quicker, Legal & General now offer: • For smaller policies, a simple declaration for signing by your loved ones confirming they’re legally entitled to the policy money. This means we can usually pay claims quicker as you won’t have to wait for the Grant of Probate • You’ll have a single dedicated claims handler for all you queries and to keep you updated on your claim. • For critical illness claims, you’ll have a dedicated claims line where we can complete the claim over the phone, saving you time. • You can place your insurance policies into trust, so the money goes straight to your chosen trustees to give to your beneficiaries after your death. The proceeds don’t form part of the estate, so may be exempt from IHT. If a client’s assets exceed the IHT threshold, the policy money would be available to pay towards any IHT.

  9. 3. It won’t happen to me! • Suggested ideas /answer: • Unfortunately it could. Just look at the facts: • - 1 in 6 workers in the UK is experiencing depression, anxiety or stress at any given time. http://www.eapa.org.uk/page--managing-mental-health-in-the-workplace.html- Around 1 in 10 of all cancer cases are in adults aged 25-49 years*. - Parkinson’s in under 40s - Parkinson’s disease affects 127,000 people in theUK, with 1 in 20 being under 40 years oldat diagnosis. - Breast Cancer under 50s - each year in the UK, there are around 1,300 deaths from breast cancer in women under the age of 50*. - Testicular Cancer under 35 - in the UK, around half (47%) of all testicular cancercases occur in men under 35 years and over 90% occur in men under 55 years*. • - 1,500 children aged under 15 years old are diagnosed with cancer each year • -1.2 million working people are suffering from work related illnesses • - 175 people killed at work • - 200,000 reportable injuries (over 3 days absence) • - 26.4 million working days lost due to work related illness and workplace injury * Please note not all types of cancer are covered under critical illness policies.

  10. - MS diagnosis in under 40s - Multiple sclerosis (MS) is the most common disablingneurological disease in young adults andaffects around 100,000 people in the UK. MS is mostoften diagnosed in people between the ages of 20and 40. - Strokes - Every year 150,000 people in the UK have a stroke,with a quarter younger people. • The good news • - More people now survive critical illnesses. For example, cancer survival rates having doubled over the last 40 years in the UK (Cancer Research UK). - Whilst lots of employers pay sick pay for 6 months (28 weeks), this could be as little as the statutory minimum of £85.85 per week. - As at November 2011, 2.58 million people of working age, were claiming long term sickness benefit ‘Employment and Support allowance’ due to illness or injury. The maximum weekly amount payable is just £105.95, highlighting the need to be self reliant financially whatever happens, as state benefits may not be enough to survive financially. (DWP website, May 2012)

  11. Income Protection Benefit -claims • If you could n’t work due to incapacity caused by an illness or injury a monthly ta2011x free sum (benefit) cold be useful to help pay monthly bills, replace income and / or cover mortgage payments. Legal & General Critical Illness Claimsin 2011. • For critical illnesses such as cancer. heart attack and strokes the average age of claimants was just 43 years old.

  12. IPB and Death claims. • Income Protection Benefit • For Income protection benefit claims such as severe back pain or long term depression, the average age of claimants was just 42 years old. • Top three reasons for claims: • - Musculoskeletal e.g. severe back pain • - Mental Illnesses e.g. depression • - Cancer • Death • For death claims the average age of claimants was just 58 years old. The top 5 reasons were (in descending order) • - Heart Attack • - Lung Cancer • - Other cardiovascular • - Stroke/Cerebrovascular Accident • - Bowel Cancer

  13. 4) State will pay – if I die/get sick (if parent with children receiving child benefit). • Suggested ideas /answer: • Legal & General’s latest Value of a Parent research shows 57% of parents don’t know what state benefits they may be entitled to. Plus the average day to day cost of raising a child is £143 per week for food, clothing to childcare, without any household bills. (L&G VOP 2011) • What problems could relying on just the following benefits cause you?

  14. *For ill and disabled people who need help looking after themselves. ** For those who cannot work or have difficulty walking.*** England, Scotland and Walesonly Information correct as at April 2012

  15. 4b) State will pay – if I die/get sick. (Single or couple with no children) • Suggested ideas /answer: • What problems could relying on just the following benefits cause you?

  16. *For ill and disabled people who need help looking after themselves. ** For those who cannot work or have difficulty walking.*** England, Scotland and Walesonly Information correct as at April 2012

  17. 5. I already have (Life/CIC/ IPB) Insurance protection.Slide 1 of 2 • Suggested ideas /answer: • Great – but when was the last time you actually reviewed it? Since then, have your circumstances changed, for example: • - moved home or remortgaged? • - changed job or got promoted at work ? • - had any children? • - sent any children to college or university? • If yes then it’s likely that your protection needs have changed and you could now be underinsured. We need to work out what you need and can afford in order to help ensure some financial peace of mind. Please note that you should never cancel any existing insurance you have until a replacement policy has been accepted and put in place.

  18. 5. I already have (Life/CIC/ IPB) Insurance protection.Slide 2 of 2 • Tips • - Check to ensure that existing cover is still the most appropriate type and level of cover • - Make sure that it is still the right quality of cover – i.e. improvements to CIC policies to include Mastectomy cover/ children’s CIC/additional definitions. • - Make sure that it’s still the most competitive – changes to smoker status / weight / health / underwriting criteria. • CONSIDER Guaranteed Insurability Option as another option to increasing their cover without the need for new medical underwriting. For more info http://www.legalandgeneral.com/advisercentre/protection/our-products/product-options-and-other-benefits/guaranteed-insurability-option/ • - Please note that clients should be aware that they should never cancel any existing insurance they have until a replacement policy has been accepted and put in place.

  19. 6. I’ve got cover through work / my work will pay death in service or sick pay! • Suggested ideas /answers to overcome: • - Employer levels of cover • - What if you ever got made redundant or retired through ill health? You could lose these benefits and end up with no cover at all. • - Have you ever considered that your employer only covers you on their terms, not what your home/lifestyle, partner or any dependants might need? • - Life • - Do you know how much life cover you have based on your annual salary? • - Lets work out if this is enough to pay off the mortgage and/or continue to pay the monthly bills.  • - Sick/illness • - Do you know how long you would be paid full pay if you were ever ill? • - What if you could not return to the same job, how would you manage? • - Ask the client to show you their contract and company staff handbook which will show the benefits available. Many clients are quite surprised to find that it may be much less than they thought.

  20. 7. Cost – I can’t afford it, it’s too expensive.Slide 1 of 4 • Suggested ideas /answer: • Cover starts from only £6 per month and some cover is better than nothing. Could you really not afford to spend the equivalent of at least 20p a day on having some cover to help in times of need? • Your biggest financial asset is you, so you should do all you can to help financially protect yourself and your family in case you were to die or become critically ill. Don’t put off planning for your financial future.

  21. 7. Cost – I can’t afford it, it’s too expensive.Slide 2 of 4 • Value of parent • If you have a family, the additional work you do around the home works out to the value of around £30,000 for a mum and £21,300 for a Dad per year. • How would you pay to replace this help if you or your partner were no longer able to do these tasks? • The younger you are when you take out personal insurance the cheaper it is, as monthly premiums are worked out based on your age, sex, smoker status and health/lifestyle. • iPhone app • Why not use our iPhone app to get a quick quote to match your clients needs. • Find out more http://www.legalandgeneral.com/advisercentre/technical-centre/tools-calculators/iphone-app/

  22. 7. Cost – I can’t afford it, it’s too expensive.Slide 3 of 4 • Here are some more examples of costs: • Life • For £6 a month you could get: • - Non smoker, 24 next birthday, 25 year term - £122,196 level term assurance • CIC • For just £6 per month you could get: • - Non smoker, 30 next birthday, 25 year term, level term - £20,266 critical illness cover as a tax free lump sum in the event of a valid claim. • (Quotes date 20/11/2012). • Premiums depend on your individual circumstances.

  23. 7. Cost – I can’t afford it, it’s too expensive.Slide 4 of 4 • Family and Personal Income Plan (FPIP) • A non smoker, aged 30 next birthday, can be insured for £1,200 per month over a period of 18 years, for a monthly premium of £8.31(Quotes date 20/11/2012). • Your actual premium will depend on your individual circumstances. • Tips • - Ensure effective use of the Budget planner. • - Benefits led - Focus on the benefits the cover will provide and what it will offer your client rather than feature selling – (see below). • - Relative cost – average cost of a cappuccino is around £2, if the client buys a coffee 5 days a week that’s the equivalent to putting aside £40 a month policy to protect themselves/family. Which is the most important to them? • - FEATURE V BENEFIT - One feature of our CIC policy is a payout of up to £25k in the event that your child were to suffer a critical illness (Feature) OR with this policy in the event that your child were to suffer a critical illness it would provide you with up to £25k to help pay for the best medical care for your child (Benefit) for example.

  24. 8. Cost- its cheaper online. • Suggested ideas /answer: • ·As a professional financial adviser I can ensure not only a competitive price but also that you get the best quality cover for your money based on your current needs. • ·In addition I can offer free support and advice on • oTrusts- putting your policy in a trust would ensure no delays by your named beneficiaries in receiving the money you intended • oYour application to ensure we include all relevant medical history and lifestyle issues and to get this policy set up • oClaims and how to do this in the future

  25. 9.Time - I haven't got time to consider insurance protection at the moment, I just want the mortgage sorted! • Suggested ideas /answer: • Ok but would you buy this house/flat and take a risk on not having house and contents insurance to protect it? • Probably not, so why take a risk on not having personal protection insurance to protect the person who needs to pay the mortgage to buy this house/flat? • Your biggest asset in life is you, so it’s important to make a little time now to help look after your future. • If you would prefer to not discuss this now, we can arrange a follow up meeting date now for a more convenient time.

  26. 10. Partner – I need to discuss it with my partner first. • Suggested ideas /answer: • OK but can we arrange a meeting now for another time to discuss this with both of you? • It’s important you don’t put off planning for your financial future now, otherwise it might be something you mean to do but never get round to. • Just as an indication, cover starts from only £6 per month and some cover is better than nothing. Could you really not afford to spend the equivalent of at least 20p a day on having some cover to help in times of need? • Value of parent • Plus if you have a family, the additional work you do around the home and looking after the children works out to the value of around £30,000 for a mum and £21,300 for a Dad per year. How would you pay to replace this help if you or your partner died or were unable to undertake these tasks. • Your actual premium will depend on your individual circumstances.

  27. 11. Don't need it – single, no kids and not married. • Suggested answer: • When you’re single it’s easy to feel free from financial responsibilities, but illness can happen to anyone at any age.  • You may think you don’t have anyone relying on you for financial security, but in reality there is someone – you! • - How much does your monthly bills add up to? • - How would you pay your bills, food, rent/or mortgage if you were ill? • - How many months would your savings or family/friends be able to support you? • Your personal deadline • Legal & General’s research shows that in Great Britain, the average person savings could only last 19 days without insurance protection until they would be on the breadline. How long would your savings last? • - Use the Calculator to determine monthly shortfall and number of days or weeks before could be on the breadline if they only had their savings to rely on.

  28. 12. Don’t need life cover, my family/the godparents said they would look after the kids if anything bad happened! • Suggested answer - Life Cover • The latest Value of a Parent research from Legal & General into the value of a parent shows the average day to day cost of raising a child is £143 per week for food, clothing, childcare etc, without any household bills (L&G VOP 2011). You need to ask your client: • - If you died, how would the family/godparents pay for the children’s food, clothing etc? • - Would they need adjust their accommodation or car? • - Would they have to give up work to look after them? • - Could they afford to do this? 

  29. 12. Don’t need life cover, my family/the godparents said they would look after the kids if anything bad happened! • Suggested answer - Illness/critical illness or disability  • What if you became ill or disabled do you know what state benefits you may be entitled to? • Legal & General’s latest Value of a Parent research shows 57% of parents don’t know what state benefits they would be entitled to. (L&G VOP 2011) • Your personal breadline deadline • Legal & General’s research shows that in Great Britain, the average person’s savings could only last 19 days without insurance protection until they would be on the breadline. How long would your savings last? • - Use the Calculator to determine monthly shortfall and number of days or weeks before could be on the breadline if they only had their savings to rely on. • - No savings – work out how much money the clients would need to save to survive for up to a year without an income and then ask them to confirm how they are going to do it if they do not want cover.

  30. 13. I’d use my savings if I got sick. • Suggested answer • - Do you know what your total monthly outgoings are that your savings would need to cover? • - How many months would your savings or family/friends be able to support you? • Your personal breadline deadline • Legal & General’s research shows that in Great Britain, the average person’s savings could only last 19 days without insurance protection until they would be on the breadline. How long would your savings last? • - Use the Calculator to determine monthly shortfall and number of days or weeks before could be on the breadline if they only had their savings to rely on.

  31. 14. I’m only renting so I don’t need illness /critical illness cover. • Suggested answer: • The average monthly rent is £868 per month. (Find a Property Rental Index – Q1 2012). • As at May 2012, the average weekly amount of Housing Benefit was £86.77, with just under three quarters of recipients being under the age of 65. Plus the average weekly council tax benefit was just £15.69 (DWP 16 May 2012). • Without critical illness or income protection insurance there could be a huge gap between what you need and what state support is available- which could cause more stress and financial worries during a difficult time. • Some cover is better than nothing. • For just £6 per month over 25 years, a person aged 30 next birthday, non-smoker, level term could have £20,266 critical illness cover as a tax free lump sum in the event of a valid claim. • (Quote date 20/11/2012). Your actual premium will depend on your individual circumstances.

  32. 15. If I got sick or died we would just sell and downsize our house/flat. • Suggested answer 1: cost of selling v protection • Whilst selling might seem an option, have you considered the fees you would have to pay if you were forced to sell through illness or for your loved ones to pay after your death. • Remember these are: • - Estate Agents • - Legal fees • - Potential re-mortgage fees for any new home you/they find • By having life or critical illness cover, the mortgage could be paid off.

  33. 15. If I got sick or died we would just sell and downsize our house/flat • Suggested answer 2 - Debt free property • Would you like to leave the property behind debt free to your spouse/registered civil partner or family? • Life cover would let you know you have safeguarded the home you shared together. • Suggested answer 3 - Registered civil partner/partner/family do not have to manage additional stress and hassle of sale at difficult time. • - Could your partner/registered civil partner/ family cope with the stress of the selling if you were ill and receiving treatment? • - Do you really want your family to have to cope with losing you and selling the house, if you should die?

  34. 16. My estate won’t owe any inheritance tax (IHT). (Married) • Suggested answer: • 40% IHT is payable on estates worth over £325,000, regardless of whether a will is made or not. • If you’re married and one party dies and leaves everything they own to their spouse / registered civil partner, it’s exempt from IHT. • In this case the second spouse’s threshold can be worth up to £650,000 before any IHT is owed (your £325,000 allowance plus their £325,000 allowance). This is even the case if the second spouse / registered civil partner has remarried. • This is great news for your children or family, but IHT is still payable on any amount exceeding £650,000, and an IHT liability needs to be paid before the estate is released. • Would your partner or children be able to pay this? • Life insurance can help!

  35. 16. My estate won’t owe any inheritance tax. (Unmarried/Single) • Suggested answer: • 40% IHT is payable on estates worth over £325,000, regardless of whether a will is made or not. • Even if you’re living with a partner, if you’re not married then you can’t transfer your IHT allowance to them, and tax will be payable on your estate if it exceeds £325,000. • Normally, any IHT liability needs to be paid before the estate is released (Grant of Probate). • Would your partner or children be able to pay this? • Life insurance can help!

  36. 16. My estate won’t owe any inheritance tax. • Suggested answer - how can life insurance help? • Any IHT bill needs to be paid before the estate is released. Beneficiaries typically have six months to settle the bill in full. • So what happens if your partner / family needs to pay a large IHT bill before they can release your estate? • - If you take out a life insurance policy and place it in trust, your chosen trustees can claim the money straight away and give it to your beneficiaries, meaning they could get this before the value of the estate is released (grant of probate) • The money from the policy is not included in the estate and is therefore not included for IHT calculation on the estate. • This money gives the beneficiaries the choice to keep the family home or sell it debt free. • By having life cover your family or partner could retain the family home or sell it when they’re ready.

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