How Adding Life, Annuity, and Hospital Indemnity Products Can Enhance Your Business - Western Asset Protection
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How Adding Life, Annuity, and Hospital Indemnity Products Can Enhance Your Business

Want to increase client satisfaction, boost retention rates and grow your business? Consider offering clients more than just Medicare. As you know, seniors have many needs. By adding life, annuity, and hospital indemnity products to your lineup, you can be a one-stop solution.

Offering Multiple Products Can Boost Retention

When you offer more products, you’re able to earn more while providing your clients with the protection they need. While that’s good, there’s another reason to expand your offerings: doing so could improve your client retention rate.

Imagine you help a client with a Medicare Advantage plan. Your client asks about annuities, but since you don’t sell them, you’re unable to help. She finds another insurance agent who offers annuities. This agent also sells Medicare Advantage as well as some other options the client is interested in. Next year, your client decides to go to her new agent for all her insurance needs, including Medicare.

J.D. Power found that the average retention rate for policyholders who bundled their auto and home policies was 95%, but the average retention rate for non-bundlers was only 85%. If you apply this finding to health and life insurance lines, it’s clear you can increase retention by offering multiple products.

What Solutions Should You Offer?

While there are many insurance options to offer your clients, consider starting with hospital indemnity products as well as life and annuity products.

Hospital Indemnity Products

Even with insurance coverage, hospital care can be expensive. Under Original Medicare, enrollees are responsible for a deductible of $1,632 for each inpatient hospital benefit period in 2024. Plus, it’s possible to have multiple hospital benefit periods – and therefore multiple deductibles – in a single year. Medicare enrollees also pay additional daily copays for inpatient stays that exceed 60 days. For Medicare Advantage enrollees, copays and deductibles vary depending on the plan, but the out-of-pocket maximum could be as high as $8,850 in 2024.

Medicare enrollees can protect themselves against these costs by enrolling in a Medigap plan to supplement their Original Medicare coverage or by enrolling in a Medicare Advantage plan with low deductibles and copays. However, these plans can be pricey and may not cover all their costs. Hospital indemnity insurance provides an affordable alternative. Better still, the beneficiary can use the lump sum cash payment however he or she sees fit.

Life and Annuity Products

As many seniors are worried about outliving their savings, they’re interested in products that provide lifetime income and financial flexibility.

Annuities have emerged as an attractive option. According to LIMRA, annuities sales reached a record of $312.8 billion in 2022. In the first half of 2023, LIMRA says sales increased again, reaching a 12% year-over-year increase in the second quarter. According to Kiplinger, rising interest rates, unpredictable markets, longevity risks, and concerns about Social Security are driving interest among retirees.

Seniors may also be interested in life insurance products. Although life insurance is often associated with younger adults with children, policies can also be useful for covering end-of-life expenses and for passing wealth onto the next generation. Seniors may also like the investment aspects of whole life insurance (which accrues a cash value) and the long-term care (LTC) planning aspects of hybrid policies. Investopedia says the pandemic helped spur interest in hybrid life–LTC policies.

Cross-Selling Strategies for Success

Expanding your portfolio is a smart way to efficiently grow your business. However, to pull it off, you need to learn some cross-selling strategies.

  • Decide which products you want to offer. Contract with insurers that offer annuities, life insurance, and hospital indemnity insurance. Ask your FMO to explain the options available to you.
  • Talk to your clients to find out about their needs. The more you learn about your clients’ financial worries, changes in the circumstances, and current coverage, the better positioned you’ll be to offer them products that meet their needs.
  • Stay compliant with Medicare rules. CMS has strict marketing rules. During a Medicare appointment, stay focused on Medicare and complete your Scope of Appointment Form correctly. Avoid discussing any additional products. At the conclusion of the meeting, or while following up after the meeting, ask clients if they are interested in additional solutions. If so, schedule a separate appointment to discuss those products.
  • Update your website, business cards, and social media. Tell everyone that your solution suite has expanded.

Are you ready to expand your portfolio, better serve your clients, and grow your business? Agents who are part of the Western Asset Protection network have access to competitive annuity, hospital indemnity, and life insurance products. Contact us to learn more.