Income protection and financial planning

What do you want to know

  • A car needs an airbag.
  • An airplane needs oxygen masks.
  • A client needs a way to survive the loss of earning ability.

Your clients have worked hard to manage their money and plan for their future, but is their financial plan protected? Since March 2020, many Americans have experienced the uncertainty resulting from the coronavirus pandemic and are now looking for ways to protect themselves from further unforeseen events. For example, would your clients be able to fund their financial plan if they were seriously ill or injured and unable to work?

Income protection insurance – or individual disability insurance (IDI) – is an essential addition to any financial plan. It will pay monthly benefits to replace lost income if your clients are unable to work due to illness or injury.

The IDI is an important safety net that can provide peace of mind. By adding income protection insurance to your practice, you can ensure that your clients are protected so that an unforeseen event, or disability, doesn’t derail their financial plans.

Consider these three reasons to recommend income protection insurance to your clients in 2022:

1. Income protection is essential.

Your customers have seen the very real impact this pandemic has had on their family members or friends – or perhaps even themselves – and may be looking for ways to feel safer. Just as this pandemic has come out of the blue, so too has an injury or illness that prevents your clients from earning their usual wages. Show them how income protection insurance will help them cope financially if an unexpected disability prevents them from working for an extended period.

2. Income protection insurance will help you stand out from the competition and retain your customers.

As a financial advisor, you help your clients plan for the future and achieve their goals by developing a solid financial plan. Part of this work is to identify and mitigate the risks associated with carrying out this plan. However, if you have not considered the potential risk of illness or injury, you risk exposing yourself and your customers.

Your clients’ income not only pays for their financial plans, but also enables them to engage with you and your services. While many advisors focus solely on asset management, you can differentiate yourself by ensuring their plans will continue to be funded no matter what. This will ensure that their plans for the future stay in place and that they can continue to work with you for years to come.