Return of Premium

[David C]

Assuming your DI company offers ROP, how often do you present the ROP rider?

 

[VolAgent]

Way too many unknowns to even begin to answer that question.

1. What triggers the return of premium? How long does the policy need to be in force, what if the policyholder dies, etc?

2. What is the price difference for the ROP?

3. What is the tax treatment of the ROP?

4. What if I have a claim? What happens then, what if the claim is less than total premiums paid in?

5. Ignoring the ROP, is this DI policy even worth owning? What if its only 2 years own occ, and I am permanently disabled in my occupation, but can perform another? What effect will that have on the rider?

I'm sure I there are more, but those are just off the top of my head.

 

[Mark]

I feel like a car salesman sometimes. After I sell the customer the car, then I show them all the options and let them pick what they want.

I think you should always offer all of the riders to the client. Lte them pick what they want to add to their policy.

 

[stormtracker]

I don't quote ROP because although it might sound good to the client initially, they fall out real quick when they hear the difference in premium. I am also not comfortable with a rider that can be forfeited so easily-- which would reflect poorly on the carrier and myself, in the end. Clients, and their families, just aren't likely to remember the rider's requirements for ultimate payout.

 

[NCnatwidagent]

Another thing about riders. I always show the client what riders they qualify for depending on the type of policy. If you don't at least let them know what they can get, it might come back to bite you later.