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I’m new in the industry. My mentors have saved people’s families, helped people retire and comforted the sick as they recovered.

I want to do the same, but most people my age are too busy paying off debt and finding jobs, so they won’t think about insurance until it’s too late. And most assume they don’t need policies if they don’t own homes or have children.

Read: Faceoff: Is costlier insurance cost-effective?

Here’s how to change their perceptions. Tell them there’s tremendous value in locking in insurability at a young age. My grandfather taught me you don’t buy insurance with money; you buy it with good health.

Convey that message clearly to young professionals, who don’t yet understand how insurance helps protect goals and dreams. Give them the basics on the differences between term and permanent policies, the importance of both life and living benefits insurance, and the tax-free benefits of these policies.

As you do, emphasize insurance gets more expensive and harder to qualify for with age. A permanent policy would cost a 25-year-old about $175 a month for $500,000 of coverage, but $470 for a 45-year-old. If $175 doesn’t fit in a young person’s budget, reduce the coverage amount or suggest a term policy with a conversion option to permanent insurance to lock in insurability now.

Conversation starter

do you have good
benefits?

Read: Catch overlooked insurance needs

For those who insist they’re covered through work, explain the limits of employee benefits. Yes, they provide basic coverage, but employee benefits won’t sufficiently replace income as the client’s family grows. An average life insurance plan offered through group benefits pays a $25,000 to $50,000 death benefit. Other companies pay up to one year’s salary if an employee dies. In most cases, that’s not enough to cover a family. And if a client switches companies, her benefits package will change. And don’t neglect to point out many insurance companies offer post-secondary graduates discounts on insurance rates, depending on occupation and income.

When talking to young prospects, you’ll have more success if you portray insurance as a tool that protects them, their dreams and the people that mean the most to them.

Don’t forget tenant’s insurance

Many young clients have left the family home and moved into rental accommodations.

So the Insurance Bureau of Canada says they should consider the following:

  • Notify your insurance representative to review available coverages and discuss the possibility of purchasing a tenant’s policy. This should include two kinds of coverage—Basic Liability and Contents.
  • Keep an up-to-date list of your belongings in case of theft, loss or damage.
  • Landlords have relatively few legal obligations to compensate tenants for damage to, or loss of, their personal possessions.
  • You could be held responsible if your actions caused damage to your apartment, your neighbours’ apartment(s) or the building itself. Without insurance, you would be personally liable for such costs.

Read: Travellers bring underwear, forget insurance

Sarah Brown is a licenced marketing assistant at Al G. Brown & Associates.

Originally published in Advisor's Edge

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