New to Disability and looking for advice and direction. Have a client who is ready to go. White collar and earns in the $180-$200k range. Wondering what product options available and length of process involved and what expectations to set with client. The client is 46 years old, good health, 6' 180" non-smoker. Any help appreciated. Thanks!
What Would the DI Experts Do?
- Thread starter Go Green
- Start date
What's the occupation?
Should have own occ (pure own occ, not some modified or switching to any occ stuff) coverage that is both guaranteed renewable and non cancelable.
Riders that would be important in order of importance:
- Residual
- COLA
- Guaranteed increase option rider (allows him/her to buy more coverage if income goes up w/o medical underwriting)
------------below this line I'd consider very optional--------
- Unemployment waiver of premium (offered by some companies and usually really cheap)
- CAT rider (catostrophic disability rider also usually really cheap)
- SIS rider (soscial insurance substitute, it would very unusual to use this rider in this case)
The underwriting process won't appear much different from life underwriting to the client. Of course, there will be much more financial documentation required.
If you discover anything that might be excluded from the policy due to medical history bring it up and address it directly. Remind the client that without this sort of provision the insurance company wouldn't be able to offer him/her coverage at all.
In terms of price, DI usually runs between 3 and 5% of gross income.
To age 65 or 67 benefit period would be a good idea.
You should also talk to him about covering his/her retirement contributions. This can be done either by rider or a stand alone policy. There are many benefits to this. I can elaborate more if you give me details on the retirement plan.
G
Guest
Guest
Unusual because people who have higher incomes and higher occupation classes don't need the break in price a SIS rider gives. SDI if I'm not mistaken is the same idea as NY state's DBL, this is not for long term disabilities.
Why would most people dislike the idea of the SIS rider? Remember, the rider says it will pay a benefit only if you do not receive SSI benefits, which is likely to be the case at least for the first year of your disability. But keep in mind that the requirements of SSI are either likely to result in your death, or be irrevocable. Meaning if you have a permanent total disability you won't collect on the SIS rider once your social security benefits begin. I don't find too many peopl who are willing to pay for something where the worse off they are, the less likely they will collect benefits from it.
G
Guest
Guest
Are you saying that while an SSI rider costs extra, the overall premium of a DI plan will be lower with it?
I don't do much DI but I have a pretty good DI GA and he always recommends that the client take the social insurance rider, especially for people grossing around $80K and looking for the max benefit they can get (which is usually around 60 to 65% of that gross.)
Am I getting good advice in SDI CA? BTW, SDI here pays a max of about $940 a week for one year... however no one ever gets the max... and the formula for computing the benefit is complex... depends on earnings over the past several quarters, who won the Super Bowl, and if the moon is in Jupiter!
DI is a though to sell in CA because everyone thinks SDI is a long-term plan... which it isn't. TTBOMK, most carriers in CA won't pay in addition to SDI. There is an automatic offset. A lot of agents suggest that clients take a 1 year wait period and live off of SDI. This helps to lower the premium.
I'd like to do more DI but no one thinks "a Christopher Reeves" will happen to them. Health and life are easier... everyone knows they will get sick and die! Also, in CA there are not many carriers to choose from.. and the 50% DI commish they all pay... considering the amount of time it takes to educate and sell it does not seem to make it a good use of time... even with the renewal... compared to selling group or individual health... which has harder UW but is an easier "sell."
YMMV.
Al
I don't do much DI but I have a pretty good DI GA and he always recommends that the client take the social insurance rider, especially for people grossing around $80K and looking for the max benefit they can get (which is usually around 60 to 65% of that gross.)
Am I getting good advice in SDI CA? BTW, SDI here pays a max of about $940 a week for one year... however no one ever gets the max... and the formula for computing the benefit is complex... depends on earnings over the past several quarters, who won the Super Bowl, and if the moon is in Jupiter!
DI is a though to sell in CA because everyone thinks SDI is a long-term plan... which it isn't. TTBOMK, most carriers in CA won't pay in addition to SDI. There is an automatic offset. A lot of agents suggest that clients take a 1 year wait period and live off of SDI. This helps to lower the premium.
I'd like to do more DI but no one thinks "a Christopher Reeves" will happen to them. Health and life are easier... everyone knows they will get sick and die! Also, in CA there are not many carriers to choose from.. and the 50% DI commish they all pay... considering the amount of time it takes to educate and sell it does not seem to make it a good use of time... even with the renewal... compared to selling group or individual health... which has harder UW but is an easier "sell."
YMMV.
Al
CA's vertsion is much more accomodating than NY's--no wonder they are bankrupt--but still definitely what I would want to rely on.
In terms of the rider, the SIS rider is added to base benefit, but it costs less than base benefit so the overall premium of the policy is cheaper. Maximum participation is effected by the SIS rider amount.
The problem with the SIS rider is, everytime someone receives benefits from a government program, they lose their SIS rider benefits--paying for something they won't receive. Having the base coverage instead, which wouldn't be effected, is a better bet.
Why would the need to be like Christopher Reeves? 92% of disabilities are the result of illnesses not injuries. Why do people have health insurance? If it's so they don't have to pay full price when they get their physicial, you might want to ask them to review how much it costs to have their health insurance versus how much a docotor's visit costs. I bet they still won't drop their coverage.
Disability insurance insures one's ability to receive their future income even if they can't work to earn it, mathematically it would be impossible to self insure this potential loss.
Men have a 43% chance of being sick or injured and out of work for 6 months or more at some point in their working lives; women have a 52% chance.
50% of mortgage foreclosures and 50% of personal bacnkrupcies are the result of disabilities.
To those who say it won't happen to me, I ask which is worse, to have it and not need it, or to need it and not have it?
2 years on claim will ususally pay for an entire working lifetime's worth of paying premiums.
In terms of the rider, the SIS rider is added to base benefit, but it costs less than base benefit so the overall premium of the policy is cheaper. Maximum participation is effected by the SIS rider amount.
The problem with the SIS rider is, everytime someone receives benefits from a government program, they lose their SIS rider benefits--paying for something they won't receive. Having the base coverage instead, which wouldn't be effected, is a better bet.
Why would the need to be like Christopher Reeves? 92% of disabilities are the result of illnesses not injuries. Why do people have health insurance? If it's so they don't have to pay full price when they get their physicial, you might want to ask them to review how much it costs to have their health insurance versus how much a docotor's visit costs. I bet they still won't drop their coverage.
Disability insurance insures one's ability to receive their future income even if they can't work to earn it, mathematically it would be impossible to self insure this potential loss.
Men have a 43% chance of being sick or injured and out of work for 6 months or more at some point in their working lives; women have a 52% chance.
50% of mortgage foreclosures and 50% of personal bacnkrupcies are the result of disabilities.
To those who say it won't happen to me, I ask which is worse, to have it and not need it, or to need it and not have it?
2 years on claim will ususally pay for an entire working lifetime's worth of paying premiums.
SetforLifeIns
New Member
- 6
I would need more information to help you assess.
What is their occupation? What is most important to the client? Is it cost? Benefits? What are their future needs?
What you recommend really depends on the client. Ask some more questions to determine what is optimal for your client.
Pure own occupation is important for most medical specialties, but less so for other occupations. It may cost a lot more and not be necessary.
If you would like to discuss it in more depth, feel free to contact me and I'm happy to assist you.
[email protected]
What is their occupation? What is most important to the client? Is it cost? Benefits? What are their future needs?
What you recommend really depends on the client. Ask some more questions to determine what is optimal for your client.
Pure own occupation is important for most medical specialties, but less so for other occupations. It may cost a lot more and not be necessary.
If you would like to discuss it in more depth, feel free to contact me and I'm happy to assist you.
[email protected]
