After a hiatus of nearly 18 months, Best Insurance has re-launched its range of instant protection – Accident, Sickness and Unemployment (ASU) insurance. This popular form of comprehensive protection covers loss of income arising from unemployment, accident, and sickness.
These policies have always been popular for the value they provide, the ease of getting these policies set up and the simplicity for brokers. Also known as 'short-term' income protection, these policies cover up to 65% of gross monthly income. The claims payments are tax-free, no deductions made regardless of any benefit claimed from the Government or their employer and, the benefit amounts are paid straight to your client. Also, there are no restrictions on how these benefit amounts paid is spent.
For most people, the loss of a monthly salary would severely impact their ability to maintain their lifestyle, pay their mortgage or rents, utilities, groceries and more. With Best Insurance's income protection, your clients will still be able to have the much-needed peace of mind that they do not have to deplete their savings or rely on Job Seeker's Allowance, Statutory Sick Pay or borrowing from family and friends.
Undisputed value in ASU policies for our customers
While several customers have all types of insurances such as car, home, pet, travel etc., the one thing that funds all of these, i.e. their income, gets easily ignored.
The main reason for not having these policies is down to awareness. Once clients understand that such policies exist, the value they provide, and the simplicity of buying and making claims, it tends to be one of the policies they keep and renew for several years.
From an ROI perspective, typically, it would cost £40 for £1,000 of monthly benefit. Let's assume your client makes their first claim only after ten years of buying the policy and at that point gets paid £1,000 for 12 months, i.e. £12,000. Simple maths show that this will give them an ROI of whooping 250%. All we need is to ask our clients to set aside just over £1/day to buy this peace of mind.
Attractive return for brokers
A common misconception is that ASU policies commissions are not as attractive as other protection products such as life insurance, critical illness cover, etc. Is it? Time for some simple maths again!
Commission for Best ASU policies is payable every year on an indemnified basis. Considering the average duration of seven years, a sale of just one policy per week at a monthly premium of £40 would result in commissions of about £5,760 in the first year. Over the next seven years, the cumulative commission value will be about £161,000.
The benefit doesn't stop here. Unlike lower business valuations that come with onetime indemnified commissions, these annually indemnified models fetch multiples of 5x, meaning the valuation of ASU sales will be worth nearly £800,000. All for selling just 1 ASU policy every week.
Sold correctly, the commission income from ASU will be a massive business value enhancer and bring in the much-needed blend of recurring commissions to enhance the sustainability of your business.