Wednesday, March 31, 2021

What Is Being Left Out Of The Holy Trinity Of Insurance?

One part of my insurance practice involves worksite supplemental benefits. (Think dental, vision, cancer plans, etc.) On occasion, I give talks to groups of employees on these benefits. And one of the things I cover is the "Holy Trinity of Insurance", which is comprised of their health coverage, their life insurance, and last but not least, their disability insurance (DI).

Over the next day or so I'll speak with these employees individually and sure enough, someone will come in and ask for that "Holy Trinity insurance". Pretty funny I think, but it lets me know that I'm getting through to them. 

The reason these people buy DI is because they see the value of insurance on their paycheck. And that sums up DI in a nutshell - income insurance. You insure your house and car, which is paid for by income, so it makes sense. And no matter if the client is a realtor, plumber, attorney or a doctor, if they can't work, they can't pay the bills. 

There are many self-employed folks who don't have access to these group plans, but still are interested. For them, we offer individual plans which differ slightly. For instance, not only is the client's health underwritten, but sometimes, the personal income will be underwritten as well.  I know of one carrier who underwrites income at the time of the claim. Depending on the disability insurance company, they may want copies of your tax returns for the last two years at the time of the application. I have one carrier, however, that asks for that information when a claim is filed.

And your job is part of the equation too. Generally, the less safe your job is, the higher your premium. Logic says that a welder would be at a greater risk of getting hurt than a retail worker. With this in mind, some occupations are harder to cover than others. I've had great DI clients over the years who were teachers, boat engine mechanics, firemen, attorneys, realtors and truck drivers. 

I have an agent who was concerned about this for their realtor clients. Because realtors incomes are rarely the same from year to year, how would the company know how much to pay out? When I had an opportunity to speak to an underwriter she eased my fears and said, "We are fully aware that incomes change and will pay out the amount the policy designates. Our concern is making sure that client has a job and that they can't work to do that job." That made me feel better.

Years ago I met a professional golfer who played on a "minor league" tour and was interested in DI. Unfortunately, I couldn't find a single carrier that would make her an offer. Her "professional" status was a quick application killer as the company wouldn't know how much to pay out if she were sick, or more likely, injured. 

The cost of disability insurance is less than you would expect, but by insuring your paycheck, it's worth every cent.

If you are looking for short term or long term disability insurance coverage, we are happy to help you out. You can even book your own appointments to fit your schedule.

If you would like a quote, feel free to try the link on our website and have a insurance quote emailed to you. (Remember that all quotes are estimates and rate may change in the underwriting process)

Chris Castanes is the president of Surf Financial Brokers, helping people find affordable life and disability insurance coverage. He's also is a professional speaker helping sales people be more productive and efficient and has spoken to professional and civic organizations throughout the Southeast. And please subscribe to this blog!

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