Mutual of Omaha Accidental Death

[tlmarketing]

The target market are people with money to pay their bills, it's not a case of choosing between paying for groceries vs insurance.

A lot of this target market are business owners who have been through the process of getting declined for life insurance...and it does not make sense financially to buy small face GI policy given small face/high cost.

Granted they may die from their illness, but what if they dont? What if they get killed in an accident...this is can be viewed as an inexpensive hedge against that accidental death possibility.

thanks for feedback

 

[scagnt83]

The target market are people with money to pay their bills, it's not a case of choosing between paying for groceries vs insurance.

A lot of this target market are business owners who have been through the process of getting declined for life insurance...and it does not make sense financially to buy small face GI policy given small face/high cost.

Granted they may die from their illness, but what if they dont? What if they get killed in an accident...this is can be viewed as an inexpensive hedge against that accidental death possibility.

thanks for feedback

I work with business owners. And have never sold one of them an ad&d policy.

For a business owner who has been declined for LI, the best way to go is to exhaust all LI options. Because half the time you can find a company that will take them.

If not, then the CI policy is the way to go.
Most business owners are above age 45.
Which means they are 300+% more likely to die of illness than an accident.

A CI policy would be MUCH MUCH MUCH more valuable than an ad&d!!!

Also, for a business owner, often you can find SI or GI group coverage if you have insurability issues. That is what I usually end up doing.

But for the 1%-5% who might not be able to qualify for the above options, an ad&d policy might hold some value...

 

[Norwayguy]

I agree with most of what everyone has said. Having said that we can not discount the perception some of our clients have about the value of a dollar for premium. Just recently ran into a situation where I sold MoO Guaranteed Accidental Death.

I asked upfront about Nicoteen and Tobacco use and was told by both the husband and wife that they did not use any. Came to an agreement on the coverage they needed and a premium they could afford and I got to the tobacco use question on the app and now even though the husband told me twice he doesn't smoke or use any nicoteen products it turns out he does and the premium as a smoker for the coverage we discussed became a deal breaker. The next thing I did was look at changing term lengths and coverage amounts to get down to the premium he already agreed to but once I presented that option to him he did not believe the amount of coverage was worth the issue.

At this point the husband and wife are both putting off the application even though nothing has changed for her. So I asked the husband what his most pressing concern was concerning death and he works with some dangerous machines. I presented the Accidental Death policy with ROP for more coverage with ROP and was still cheaper in premium than what he had agreed to. I also told him that he had mentioned he had been thinking of quiting and this was all the more reason to quit and once he quit and 12 months go by we can apply for a true life insurance policy.

So the way I look at it in this situation both the husband and wife were going to go without this additional protection. The result was that the wife took the application for a true term life policy and the husband has a little more coverage than we had discussed but it is all accidental death.

Having said the above I don't see prospecting for someone to purchase just and Accidental Death policy. I would be more likely to talk to those daycare workers about a small DI or accidental DI policy (assuming its outside the home).

 

[VolAgent]

Peter, what you said is the difference. He works with dangerous machines. AD&D is much more valuable to someone in a dangerous occupation. I bet you couldn't even get AD&D as an Alaskan crab fisherman.

What was originally discussed is $10/hr day care workers. Unless they have Chuckie running around, they are extremely unlikely to suffer an accidental death, particularly as they age.

 

[SportsNut]

So the way I look at it in this situation both the husband and wife were going to go without this additional protection. The result was that the wife took the application for a true term life policy and the husband has a little more coverage than we had discussed but it is all accidental death.

The only thought that I have here, and this is coming from someone that has NEVER sold an AD&D policy... if I were in that situation where I had this client and was selling the acc death plan, I would have a self generated disclosure form that states "You understand that you are applying for AD&D only and this policy will pay 0 if death occurs by other than accidental causes" [or some other language]. Also have his wife sign the disclosure. My concern would be that the guy get cancer [smoker] and 6 months from now he is dead and the wife is complaining that she didn't know that ins was accidental only. Gotta cover your @zz at all times... and the AD&D policy seems like more exposure than I would feel comfortable about. Just my thoughts on it.

 

[tlmarketing]

all good points...

For an uninsurable, would the CI policy exclude the existing medical condition..maybe a combination of CI and AD for some of these folks?

I've never sold AD or CI before, neither has this agent but it just seemed like it may be an option for the uninsurables...

Another scenario where AD came up recently was for a healthy private pilot..my agent proposed a company based on flying hours, certs, etc.. a competitor offered the same company but then advised the pilot for an extra $80 per month, they could get an additional $500k with Omaha that would return premiums at end of term and that agent won the case...got us thinking.

 

[Norwayguy]

Peter, what you said is the difference. He works with dangerous machines. AD&D is much more valuable to someone in a dangerous occupation. I bet you couldn't even get AD&D as an Alaskan crab fisherman.

What was originally discussed is $10/hr day care workers. Unless they have Chuckie running around, they are extremely unlikely to suffer an accidental death, particularly as they age.

I might have a slightly different take as it will depend on the daycare worker. My wife currently works as a daycare or as they call it childcare associate. She also grew up on her mothers and her fathers farms (divorced) she and our kids still spend a bunch of time at both locations and even though they take precautions the steers and horses weigh a signifigant amount not to mention just this past year I had an appointment have to reschedule as his brother was tired by a steer that very days.

I still think a true life policy and disability would be a better fit overall but I would not hesitate to offer an accidental policy as I walk out the door and if the client expresses they want it and can afford it I will sell it because I would rather they have some coverage over nothing and I sure we have all been affected by news of a young driver having been killed either by a drunk driver or an accident.

 

[scagnt83]

For an uninsurable, would the CI policy exclude the existing medical condition..maybe a combination of CI and AD for some of these folks?

I've never sold AD or CI before, neither has this agent but it just seemed like it may be an option for the uninsurables...

CI usually does not carve out exclusions like DI does.
CI uses different underwriting criteria.
Some LI declines can get CI, some cant.
Some CI declines can get LI, some cant.


For the truly uninsurable for LI, sure, a combo of CI & ad&d isnt a bad option. But I would throw in a GI FE policy too to cover basic final expenses.



But to make ad&d a niche marketing campaign would not be a wise use of time imo.

Lets say at best it takes 1 hour of prospecting & 4 one hour meetings with 4 prospects to produce 1 sale.

At $10/m thats $120 tops in comp. Most likely more like $100 -$90 in comp.

So at best, your making around $20/hour prospecting for ad&d.
Compare that to traditional LI which in the same scenario would be around $60 per hour of prospecting at minimum.

 

[tlmarketing]

I'm thinking of adding some marketing to existing websites to see what happens...very little cost to me, upside potential of joint marketing deal....apparently there is about 140% total compensation in the contract to the BGA.

 

[Norwayguy]

But to make ad&d a niche marketing campaign would not be a wise use of time imo.

Lets say at best it takes 1 hour of prospecting & 4 one hour meetings with 4 prospects to produce 1 sale.

At $10/m thats $120 tops in comp. Most likely more like $100 -$90 in comp.

So at best, your making around $20/hour prospecting for ad&d.
Compare that to traditional LI which in the same scenario would be around $60 per hour of prospecting at minimum.

I second scagnt83 here. I just don't see the accidental plan as being something I work market as a niche....As a side note if you decided to go this route just be aware you will be competing against companies that specialize in this market selling small Accidental Death policies by mail.

I might say you would be better off marketing for accidental DI or just short term DI except for the fact that I have had many more declines on the DI side of things than the life side of things. I would lead with life and affordable benefits $1, $2, $3 or $4 dollars a day for coverage is affordable your going to meet smokers blowing more than that a day on a pack of cigarettes or people stopping off and grabbing 1 alchoholic drink after work or someone buying 2 coffees per day spend more than $4 a day for those things...