Tim Kukieza: Essen­tial dis­abil­i­ty income strategies 

Matt

Hello and welcome to Assurity’s podcast Tips from the insurance pro. In this series, we talk with industry pros as they share ideas and insights you can use today. I'm your host, Matt. And in today's episode, we're discussing a timely and important topic - disability income insurance. With me is Tim Kukieza, vice president of disability insurance at Ash Brokerage. Tim is a disability income expert with a wealth of experience in the insurance industry, and he's led Ash’s DI marketing team for more than 11 years. Tim, it's great to have you with us here today.

Tim

Thank you very much. I very much appreciate the opportunity to talk to everybody.

Matt

Well, just to get started, can you share a little bit about yourself and your background?

Tim

Yes, I can, thank you for asking. From my side of things. I've been in the business now for about 30 years, and I spent that whole time in the DI space. And it's been enjoyable for me over these last almost 30 years, and I look forward to have many years more spending time in this space and making sure clients understand the idea of income protection and how reasonable the pricing for income protection can be. I also have now led the Ash brokerage DI marketing team for 11 plus years, and it's a great team of people. We focus primarily and solely on the idea of income protection, both on the marketing side of things and the case management side. Before coming to Ash, I was also a company rep for a number of different DI carriers in the marketplace.

Matt

So you have a lot of experience in DI, which is perfect for this discussion. Maybe you'll be able to tell us, why is there a unique opportunity right now to bring attention to the value of disability income insurance, specifically the value of a policy that provides money for someone if they’re totally disabled and can’t work?

Tim

Yeah, that's a great question. So you know, when the environment that we're in right now going through the COVID-19 event itself, and even prior to that, one of the things that is a big focus is making sure and making people aware of how important their paychecks are, and again not wanting to take advantage of the situation we're in because it's a situation that nobody wants to be in. But I think again, even prior to this, the focus that we've had and a focus that I've really paid attention to is making sure that people understand how important their paycheck is. Not only the importance of that paycheck, not only after this event but also just moving forward for a long time into the future. This is a situation where a lot of people now understand how important their paycheck is again because of COVID-19. Understanding that the stimulus package that the government has now put out into the marketplace. It's something that was needed for some of these people to get through an event that nobody else wants to go through again in their career. But the idea of income protection is definitely a situation now, where from an advisor standpoint, this I think gives the advisers and opportunity to profile their clientele, to get themselves as advisers ready and prepared for having a conversation around income protection, and to be very consultative in their approach to having your clients protector most valuable asset, which for most people is definitely their income.

Matt

Absolutely. And these discussions are so important to have. So in preparing for these, what kind of messages are you encouraging producers to share with clients and prospects?

Tim

So one of the big things is that an income protection policy is needed, as a lot of people are understanding how important their paycheck is now in these events that are going on, but even prior to this, I want to focus on prior to COVID-19 and even after COVID-19. But on the other side of that, how affordable income protection can be. And it's incredibly important I think that the advisers themselves simply have an open dialogue and a conversation with their clients around the idea of protecting your income, not simply to present a plan for their clients, but to have an open conversation to show them how important their income is, the client’s income is, and how reasonably priced a protection plan can be for those clients in regards to ensuring that income. The other thing is that a lot of advisors don't go down the path of the business products when it comes to income protection and the business products for disability insurance. So the idea of the business clients I think in that space is something that a lot of advisors don't pay a lot of attention to. But it's something that this may give them an opportunity to profile those business owners in a different way for other products other than the pure income protection that is typically talked about in the marketplace.

Matt

Absolutely. And I want to piggyback off of that and talk about the right prospects for DI. How does the producer identify the proper prospect for disability insurance?

Tim

I don't want to oversimplify that question if you will. But the idea in my mind, is the majority of people who have an income are prospects for income protection insurance. Now I'll put some caveats to that, but the idea of you know, when I look at and I talked advisers out of the marketplace, whether you want to use an age range of like 27 to 50 – the DI carriers will go beyond those ranges in the upper ages and below that, but I think that's a good sweet spot in regards to that. The majority of people who have an income are prospects again for income protection. But there's a couple of different things in regards to caveating those criteria, if you will. One is you have to be able to do a little bit of field underwriting when it comes to disability insurance. Because we know that the underwriting aspect of disability is different than life insurance. And not all clients will qualify for income protection coverage, disability insurance versus the life insurance side of things. So one of the things that the advisers need to pay close attention to in my mind is field underwriting and making sure that clients can reasonably get through the DI underwriting process versus the life insurance underwriting process. Another thing that we run into a lot is the advisers themselves don't understand the idea of supplementing an employer sponsored group LTD plan. So when you look at a client and all of a sudden that client simply says, well, my company provides me an employer provided group LTD plan, those are great benefits that those clients might have. But they're also not the end all be all when it comes income protection. There's a lot of nuances with those group LTD plans that advisers need to pay attention to, to make sure that their clients have the right amount of coverage. So just a couple of items there are things along the lines of the percentage of income replaced, the taxability of a group LTD plan, the cap on a Group LTD plan and maybe even what's covered, like are bonuses or overtime covered under the group LTD plan. So when you look at these clients and you say the idea of you know who is a prospect for group LTD or for any sort of income protection, the idea of whoever has an income and don't let out client that has group LTD stop the conversation, see if you can actually supplement that group LTD.

Matt

Yeah, and even taking those caveats into consideration, it's a wide market for disability insurance. Now, I've heard you talk about taking a strategic and consultative approach even earlier in the podcast. Can you share what that means and how it benefits both producers and clients?

Tim

Yeah, this is something that I’ve spent a lot of time on with my team. I'm regards to again focusing on the idea of when we have these conversations with advisers, the DI and the income protection plan isn't something that they do on a daily basis. So what we try to do is make sure we’re having a good conversation with this advisor. And not only are we listening to what the adviser is telling us about their client, and that's incredibly meaningful in putting the plan together, but we also want to provide some insight around the idea of what we see every day, as what I’ll call a sellable solution for income protection. The idea that a lot of old school advisers out in the marketplace are looking for that premier Mercedes Benz type of policy makes sense for a lot of people. But also there's a lot of people in the Middle America marketplace that just want to protect their income, and we can do it in a very affordable fashion. But to do so, we have to be consultative in how we approach that adviser in the conversation. So things like the idea of maybe a two-year benefit period on a policy could really make that policy affordable for the client versus having a to age 65; to me, that's a consultative approach. Maybe a five-year benefit period. Maybe the client qualifies for $5000 of monthly benefit, but you scale that back down to $3000 because that puts the policy in the price range that the client can afford. So the idea of making sure we're listening to the advisor and the advisor’s listening to the client, but when it's all said and done with, putting some form of policy in place to protect your clients income is much better than having no coverage whatsoever, because the illustration of the policy was priced outside of the clients price range. We've got to be able to have that consultative approach with these advisers.

Matt

Absolutely. I think that is such an important piece to bring up, especially when people are looking at these doctors and lawyers as prospects for D I. There is a massive middle market out there that can absolutely benefit from this product. Now looking, looking out a little bit more big picture. What piece of advice would you give to producers to help them succeed in the disability insurance market?

Tim

Yeah, the bigger thing that I focus on, and I mentioned part of this conversation, part of this answer a little bit earlier, is just having a conversation with your clients, making sure they understand that one - income protection can be affordable but you have to bring the conversation to the forefront as an advisor. If the clients are bringing the conversation to the table, they may already be experiencing something of a medical condition that might preclude them from getting the disability policy. So you have to be forward facing with the client and ask them the questions. The other thing that I focus on that a lot of advisors don't do a lot of disability insurance throughout their practice. And one of the things that I stress when I'm talking to those advisers is the DI underwriting process is not a difficult process, it’s just a different process than most advisors air used to versus the life insurance side of things. So you have to be aware of what that underwriting process looks like because a lot of advisers might bring one client to the table in regards to looking for income protection. And maybe to some degree, the underwriting process has gone a little bit sideways, and they're afraid to go back in and sell the next client and talk to the next client about income protection. You just have to be prepared around the differences around the underwriting process, like the income verification, the medical requirements and the idea that the DI portion of that sale is going to be different than the life insurance portion of that sale. But when it's all said and done with, the critical aspect is making sure that they understand that protecting their client’s income for the majority of the clients out there that is by far their most valuable asset.

Matt

I think that is definitely the key take away here. It is truly about protecting that income. Is there anything more that you'd like to add Tim?

Tim

I think in this environment, again forgetting about COVID-19, whether it's pre COVID or post COVID, the opportunity for advisors to have a very intelligent conversation with their clients around income protection, making sure that they decide what's an affordable type of coverage for that client. And putting that coverage in place for the client is critical to an overall planning process that these advisers are looking to provide to their clients. So the income protection and the disability insurance is as strong as it's ever been in the marketplace, and there's a great opportunity for advisors to go out there and protect their clients most valuable asset.

Matt

Yeah, that is fantastic. Well, I'd like to thank you once again, Tim, for joining us today. We really appreciate you taking the time to talk about the importance of disability income insurance.

Tim

It was my pleasure. I think this is a tremendous opportunity for us to have these conversations with the clients out in the marketplace, and I appreciate the opportunity to spend some time with you. So thank you for that.

Matt

And to our listeners. Thanks for tuning into a sureties podcast. Siri's tips from the insurance pros stay tuned for our next episode wherever you get your podcasts for more tips and sales ideas. In the meantime, if you'd like to learn more about Assurity’s disability income insurance product, head over to assuritydi.com. You can also email us at podcas@assurity.com, and we'll be happy to connect you with one of our regional reps in your area to take a deeper dive. Thanks for listening.

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