Bundling Insurance: A Holistic Approach to Helping Clients Manage Risk

To best serve clients, you know it’s important to dig deep and understand their true needs. The Canadian Life and Health Insurance Association (CLHIA) recommends implementing a needs-based selling process for each individual client, highlighting three specific steps: collect all important information about the client, implement this data into a needs analysis program to determine their requirements and provide your professional recommendation, unique to the client’s needs (1).

When you take this holistic approach, you take into account the impact that sickness or disability could have on the lives of your clients as well as their loved ones. Your recommendations may therefore include a combination of life insurance, critical illness and disability coverage. When you find yourself recommending more than one product solution, consider combining them into one bundle.

What is Insurance Bundling?

Many companies use the bundling method to amalgamate their products or services into one single package – think of your cable or internet providers for instance. Insurance bundling is much the same and involves combining multiple lines of coverage form a single or multiple carriers into a simple, consolidated package, oftentimes with a policy fee reduction.

Insurance tends to be bundled in a couple of different ways:

Option 1

The first and perhaps the simplest option is to add one or more riders (depending on your client’s needs) to the base plan. For example, if your client purchases permanent life coverage as their base insurance, it might be in their best interest to add accidental death, term insurance, a critical illness rider or a child protection rider.

Option 2

An à la carte bundled plan that you customize for your client, using multiple insurance carriers for different products, showcases the different risks that can be covered and the variety of products that you can offer. The extra bells and whistles may cost a little more, but there is value in offering your client exactly what they need – no gaps, complete coverage.

The Benefits of Bundling

Easier decision-making

Showing your clients multiple illustrations with a variety of premiums can be confusing, overwhelming, and make it harder to reach a decision. Most clients want a clear understanding of what they will receive and how much it’s going to cost them. By bundling the coverage and providing one premium, you eliminate the confusion and provide your client with a solution that is both simple and straightforward.

Protection against more risks 

Life insurance is no longer the single solution. The fact is that one in five Canadians will experience a disability and one in two Canadians will go through cancer in their lifetime (2). Living benefits have become a vital component in a holistic protection plan. By including living benefits with life insurance under one premium, you not only add value for your client, but provide them with more security against a variety of risks.      

Client Loyalty

Your clients will appreciate the benefits of bundled insurance coverage as a high-value, multi-product solution. You’ve demonstrated product knowledge, presented a well thought-out package, and may save them some money in the process. It’s a great way to build a long-term and mutually beneficial relationship!

Try presenting two or three different bundles at different price points. Removing preconceived notions of what you think the client might buy is a change in mindset and takes practice, however when you let the client decide which package they are comfortable with, it can be a win-win for your client and for you.

  1. CLHIA, 2017
  2. Canadian Cancer Society, 2017

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The Complete Puzzle: The Benefits of Bundling