DIBroker East / Eskra & Associates

Disability Insurance For Life

insurance

A Sweet Solution: Disability Income Insurance with Return of Premium

  by  DIBroker East

A Guest Blog by Andrea Blanchard, ALMI, ACS, Regional Sales Manager, Assurity Life Insurance Company

Andrea BlanchardThere I was, excitedly waiting to take a piece of candy from Mrs. Bush’s treat bag.  I love candy!!  Mrs. Bush was my first grade teacher and all-time favorite.  Yes, my turn!  I walked up to the bag, slowly peaked in, and selected what was surely the finest treat.  However, my joy was soon dashed by a series of mixed emotions.  The kid right after me grabbed a whole handful of candy – and got to keep it all!  Why the nerve of that boy!  So greedy!  Why didn’t I think of that?!  I will never forget that moment.  Up until then, I NEVER dreamt of taking or asking for more than what was presented.

Over the years I realized it’s not wrong to want more.  Wanting more is one of the fundamental forces behind passion and purpose.  So, what’s my passion?  Well, those who know me might say it’s still candy.  Seriously, I recently celebrated my 39th birthday and it was full-on candy themed with giant 6’5′ lollipop decorations.  While I do enjoy candy of all types and flavor, it’s not my passion.  What gets me up in the morning and keeps me going is my drive to help other people.

Insurance is a wonderful and highly under-rated solution that can accomplish many goals.  A typical family has insurance on their car, house…even their cell phone!  What’s alarming is these individuals rarely think about their most valuable asset, the ability to earn an income.  Many are leaving their financial well-being and that of their loved ones at risk.  A 2014 study by the Council for Disability Awareness showed that overall, only 43% of working consumers report having income protection[1].  And why is this?  The two most common obstacles are “it’s too expensive” and “it won’t happen to me.”

Not having protection can be even more expensive.  Would turning to retirement accounts, educational funds, or other savings place your client’s financial goals at risk?  If your client were to become hurt, sick and unable to work – wouldn’t they still want more out of life?  Income protection is the foundation of a solid financial plan.  If cost is a concern, a plan can be tailored to fit the exact needs of your client. Adjustments can be made to the benefit period, elimination period, base coverage or riders to reduce the premium.

As far as “it won’t happen to me” goes, there is a fantastic solution.  It’s the Return of Premium rider.  If a disability does not occur – that’s great!  Your client will get their money back and was fortunate enough to never experience the physical, emotional or financial hardship of not being able to work.  Here’s a case study:

Mrs. White, the Nurse

Age: 30
Occupation Class: 3A
Income: $62,000
Family: Primary breadwinner, married with two kids
Monthly benefit: $3,430
Monthly premium: $103.90 (2% of salary, includes riders – $56.09 without return of premium rider)

  • $1,700 base and $1,730 Supplemental DI Rider
  • 90-day elimination period and a 2-year benefit period

Also Included:

  • Guaranteed Insurability Rider – provides options to increase coverage in the future
  • 2 years Residual Disability Benefit Rider – may allow for continuation of benefit, even if part-time work is resumed
  • Retroactive Injury Benefit Rider – additional benefit paid when disability is due to an injury
  • Return of Premium Benefit Rider

ROP amount at Age 65 (retirement) is $43,154!!

The bottom line is, people are never saving enough.  This is a solution that helps your client protect their income now or provide money at retirement.  When I was in first grade, I never really thought about asking for more than what was presented.  Most of your clients probably don’t realize return of premium is an option.  Give them the option of grabbing that whole handful of candy!  Now why didn’t I think of that?!

Andrea Blanchard is the Southeast Regional Sales Manager for Assurity Life Insurance, a mutual carrier based out of Lincoln, Nebraska.  With over 16-years of experience in the industry, Andrea is dedicated to helping agents grow their business by developing strategies and customized solutions that uncover new opportunities in the middle income market.  Andrea can be reached by telephone at 800-276-7619, ext. 4533.  Click here to Connect with her on LinkedIN.

[1] http://disabilitycanhappen.org/research/pdfs/awareness2014.pdf
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Help Insureds Take Time Off of Work to Care for Family Members

  by  DIBroker East

Jill FrohardtWith the launch of Standard’s new Disability Insurance product, Platinum Advantage, in 42 states next week (January 3, 2017), the discussion below of their “Family Care” benefit is timely.

A Guest Blog by Jill Frohardt, Regional Director, The Standard

 Driving home a couple of weeks ago, I heard a story on the radio about a poll that asked men and women to list the one thing they could not live without. The results were pretty funny – women ranked their beds higher than their husbands. As someone who values my sleep, I might say it’s a toss-up between my husband and my bed, but don’t tell him that.

In all seriousness, our families are the most important thing in our lives. If they needed us, we’d be there in a heartbeat to help, and, according to the Family Caregiver Alliance, for approximately 43.5 million people in the U.S. that means providing unpaid caregiving services.

Caring for a family member can cause physical, emotional and financial stress. Many caregivers struggle with trying to maintain a job, keeping up with household and family duties, and providing care for their loved one. In a recent FMLA survey, 62 percent of employees taking FMLA leave with partial or no pay reported some financial difficulties and 30 percent reported severe financial difficulties.1

At The Standard, we want to help ease the financial burden of caregiving. That’s why we’ve provided the Compassionate Care Benefit® in The Standard’s Protector PlatinumSM individually underwritten disability insurance policy (in approved states only) for the past six years.

This built-in benefit helps replace income for an insured who suffers income loss due to taking time away from work to care for a family member with a serious health condition. The Compassionate Care Benefit pays a monthly benefit in proportion to the insured’s loss of income, for a total of up to six times the policy’s basic monthly benefit. And it’s automatically included in the Protector PlatinumSM policy at no extra cost.

Over the past six years, we’ve seen this benefit’s impact on our customers. The Compassionate Care Benefit has given some of our customers what they needed most at a difficult time in their lives: time to spend with their loved one while receiving benefits to help replace lost income.

The Standard is continuing this benefit with our newest product, Platinum Advantage, available as of January 3, 2017 in 42 states. The individually underwritten product will be released first, and the Guaranteed Standard Issue version, targeted to the employer market, will roll out shortly after.

With the launch of Platinum Advantage, we’ve retitled the benefit “Family Care” and included it in both the fully underwritten and GSI products. It previously was available only with individually underwritten IDI. We’re going “all in” with this provision!

We at the Standard are not the only ones who see a tremendous need for this benefit. In 2016, Nike and Deloitte have both added paid caregiving leave as an employee benefit, and the state of New York has mandated paid caregiving leave to begin in 2018. Paid caregiving leave is on the cusp of becoming a more mainstream benefit offered by employers.

Because the Family Care Benefit will be included in the Platinum Advantage GSI policy, your employer clients will be able to offer their employees this form of paid caregiving leave through a GSI plan.

We are extremely excited about the broader inclusion of this valuable benefit in our new Platinum Advantage product. If you’d like more information on Platinum Advantage or the Family Care Benefit, please contact the team at DiBroker East-Eskra & Associates.

1Source: Family Caregiver Alliance, Caregiver Statistics: Demographics. Accessed September 1, 2016

Jill Frohardt | Regional Director, the Standard
Jill joined The Standard in 2014. Jill has had a variety of roles in the insurance industry for 12 years, seven of which have been in sales. Prior to The Standard, Jill worked with Mutual of Omaha and Allied Insurance. Other roles have included claims, underwriting, product development and sales. In her free time, Jill enjoys running, home-improvement projects and the outdoors

 

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Metlife Suspends Individual Disability Insurance Sales—What Will the Impact be?

  by  DIBroker East

MetLife-insurance-logo-585x216For roughly the last dozen years, MetLife has been an integral part of our operation. We are wholesalers in disability insurance. We only do one thing, and we do it very well. At DIBroker East-Eskra & Associates, we add value by providing access to nine or so insurance carriers (the number changes a bit depending upon the year—Pan American also exited the market a few years back and we do very little business with Guardian at this point), by providing expertise in case design and approaches to selling, and by providing consistent top quality service. We make it as easy as possible to complete what can be a complicated sale. We focus on the professional, the small business, and the executive markets, but provide products for all walks of life and all circumstances related to disability insurance.

DIBroker East-Eskra & Associates represents nearly all of the carriers in this market (at least nearly all of the one’s willing to work with a wholesaler, so not NML for example). MetLife, along with the Principal Financial Group and the Standard Insurance Company together have made up approximately 80% of our business. Most years we have been the highest producing independent wholesaler for MetLife (we also lead Principal and are usually in the top five with the Standard). So what does the loss of MetLife mean to us?

MetLife was seen by us as something of a lumbering giant. Slow to roll out new products. Slow to fix silly little things like the software to run their Buy-Sell quotes. Too often willing to reorganize a working org chart into something that made no sense. And lacking in creative, useful marketing materials. But in the most essential ways, they had figured out how to be a major player in the IDI market.

Met has had an excellent product the last few years. Their product has sold very, very well for us in the physician market (especially with surgeons) and they have also had the most aggressive participation limits with Group LTD—participating all the way up to $40,000 for their top occupation classes at a time when most carriers would only participate up to $30,000 (Principal goes to $35,000 and the Standard just matched that amount this week).

MetLife also had developed in house expertise that puts them among the best in the industry. We have had excellent underwriters and sales reps there and we had developed relationships with many levels of management at MetLife. We felt as if we were partners with them in this great field of providing the undersold and very important product know as IDI. When they announced the spin-off of the domestic Life, Annuity, and IDI products, we had calls and visits from them to assure us that nothing would change in our world. I believe that these assurances were genuine at the time, but nonetheless somehow they made the reality of their announcement to suspend all non-GSI related sales even more of a shock.

MetLife’s departure is not good for the industry in my opinion. There are so few carriers in the industry already; we need more carriers, not fewer. Our biggest source of competition is not the NML agent or the Guardian agent trying to take business we have quoted, rather it is the reality that most people in the country do not even know what disability insurance is and have never been asked by an agent or a financial planner about their need for it.

So, we are saddened for our friends at MetLife who have had to scramble to find new jobs and we will be slightly less competitive in certain occupation classes than before. But we are ready for the challenge. Our production with Ameritas has lagged that of our previous big three for a variety of unique circumstances, but that will change. They have an excellent product (True Own Occ, very strong Residual Benefit, a Cobra Benefit—and they include a Good Health Benefit that reduces the elimination period and a non-Disabling Injury Benefit) and we have a very good underwriter with them.

Standard just announced that they will launch their new product, the Platinum Advantage, early next year. They assure us that they will be very competitive in the physician market again. The Platinum product is clearly one of the very best on the market and we are very happy to hear that they will be price competitive in the physician market. And there too we have an excellent underwriter and we love their electronic policy delivery.

Our relationship with Principal is as strong as ever. We have sent more production to them than to any other carrier and we do not expect that to change. They have a way of doing business that makes things easy and underwriting that is as good as it gets in the industry,

We were growing our production with all three of these carriers this year before the MetLife announcement and now we look forward to giving them even more production.

DIBroker East-Eskra & Associates will continue to prosper as far as we can see and our brokers who relied upon MetLife will feel only the slightest of bumps as they adjust to selling Principal, Standard and Ameritas. We still have great products and great service to offer. In fact, compared to where we were a dozen or so years ago when MetLife become a player for us, we are much better situated.

*Please note that MetLife will continue to offer GSI and buy-ups to GSI and will continue to service existing policies, including purchase options.

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A Great But Little Known Free Business Valuation from the Principal Financial Group—by Michael J. Eskra, III

  by  DIBroker East

MichaelRecently a good producer by the name of Brock Jolly came to me for help with a group of Podiatrists he works with.  Brock’s primary company is Mass Mutual, but Brock shops every case for his clients to find the best fit.  His clients all had personal disability insurance and were now looking to insure their business. More specifically, they wanted to fund the buy-sell agreement their attorney had recently drafted for them.

 

The four partners all had equal ownership interest in the business.  When Brock approached me about the case my first questions were “how much are they looking to insure the business for” and “what is the business worth”?  They did not know the answer.  Without some idea of what the business is worth, I was unable to prepare options for them and Brock was also unable to prepare options on the life insurance side which they also requested from him.

 

At that point I told Brock about the Business Valuation that Principal offers at no cost to the client.  He loved the idea and his clients loved that they would not have to spend the $5,000 to $10,000 that accountants typically charge for such a valuation. Although this process may not meet all the needs that arise when seeking a business valuation, it more than served the purpose of helping these clients decide on how much coverage they needed.

 

I had Brock collect the last three years of business returns, a current balance sheet, and a profit and loss statement and sent them to Patti at Principal Life.  Patti is a CPA and a terrific resource for valuing small businesses.  She is very knowledgeable and provides an excellent product. The process took about 3 weeks. The end result was a first class, very professional report.  Principal valued the business five different ways to give them some options.  The clients were thrilled with the report and of course loved the cost.  They purchased both life and disability insurance policies to fund the liability created by their buy-sell agreement.

 

At DIBroker/Eskra & Associates we handle cases like these every month if not more.  To date the clients have always been satisfied with the valuation report.  Sometimes they go forward with insuring themselves and sometimes they buy policies to cover the risk, but they always leave happy….

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