Petersen International Underwriters https://www.piu.org Yes. We cover that. Fri, 08 Mar 2024 23:43:34 +0000 en-US hourly 1 Spring Break Dangers https://www.piu.org/communicators/spring-break-dangers Tue, 12 Mar 2024 14:00:00 +0000 https://www.piu.org/?p=7572 Spring Break school holidays will soon be here, and millions of Americans of all ages will be traveling with families, as couples, as individuals and as part of student and friend groups throughout the country and abroad.  Many are embarking upon these vacations without a firm grasp of the potential and inherent hazards. In addition […]

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Spring Break school holidays will soon be here, and millions of Americans of all ages will be traveling with families, as couples, as individuals and as part of student and friend groups throughout the country and abroad.  Many are embarking upon these vacations without a firm grasp of the potential and inherent hazards.

In addition to the familiar Florida and Gulf Coast U.S. hotspots, many sunseekers are venturing south of the border to more exotic ports of call where the legal drinking age is 18 and the civic regulations and safety standards are sometimes less than one would hope.  Off-road motor vehicle and recreational watercraft operation are common practices at many Latin American and Caribbean locales, and with the prevalent use of alcohol and drugs, accidents and injuries occur frequently.  The actions of intoxicated and carefree spring breakers can be detrimental to themselves as they may not be aware their U.S. health insurance policies typically provide minimal coverage while overseas.  However, there are other significant dangers lurking.

As tourists let loose and focus on the fun as well as their beautiful surroundings, they let their guards down, making them perfect targets for criminals.  Mexico, parts of the Caribbean as well as much of Central and South America continue to be criminal breeding grounds.  Tourist destinations like Tulum, Cancun, Mazatlan and Acapulco have all recently been regular locations for kidnappings, extreme gang violence and drug cartel shootouts.  Anyone traveling in Latin America or the Caribbean needs to stay informed, cognizant of their surroundings and protected with sufficient insurances.

Petersen International offers a variety of protection plans for Americans traveling outside the United States for Spring Break.  The USAway International Major Medical Plan provides inexpensive, short-term medical insurance with benefits including emergency medical evacuation back to the U.S. as well as options for coverage of COVID infection.  Accidental Death & Dismemberment insurance and Kidnap & Ransom insurance are also important products to many families with children traveling abroad.  Kidnappings for ransom have become efficient sources of income for foreign organized crime outfits, and Petersen International has a product that employs both monetary benefits and a crisis response team to properly manage the safe return of persons kidnapped while traveling outside the U.S.

Spring Break travel may be fraught with dangers, but Petersen International Underwriters has the tools to protect and reassure your clients during this generally fun and exciting time of year.  Call us today at (800) 345-8816 for quotes and expedited policy issuance.  We can have insurance in your clients’ hands in time for their upcoming travels.

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Business Travel Accident Insurance https://www.piu.org/communicators/business-travel-accident-insurance Tue, 05 Mar 2024 15:00:00 +0000 https://www.piu.org/?p=7567 In the financial services world, many of us spend a lot of time on the road.  Now that the COVID hysterics have generally died down, the frequency with which we find ourselves in hotel rooms fighting jet lag, preparing for early morning meetings seems to be increasing as business relationships have mostly gotten back to […]

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In the financial services world, many of us spend a lot of time on the road.  Now that the COVID hysterics have generally died down, the frequency with which we find ourselves in hotel rooms fighting jet lag, preparing for early morning meetings seems to be increasing as business relationships have mostly gotten back to normal.  In the digital age, no longer is business anchored in our own backyards.  If we want to stay competitive, to effectively court a prospect or attend a trade convention, we have to push past complacency.  Even though much of our business today is transacted electronically and most meetings are conducted online or over the phone, it usually pays off to hit the road or board a plane.  From a sales and services perspective, the face-to-face encounter is essential for customer reassurance and satisfaction.  Similar circumstances arise in most other industries; if you want to make an impact on present or prospective clientele, you must be willing to travel, to make house calls.  No matter if your client is in Yuma, Arizona or in Uganda, it is imperative to keep your services mobile and readily available.

And with so many executives, contractors and salespersons traveling throughout the United States and abroad, many American businesses have inadvertently opened themselves to a number of liability issues of varying potential severity.  One looming catastrophe would be the untimely death or the serious injury of a traveling employee, ultimately causing a firm to be subject to legal and financial scrutiny over possible corporate negligence resulting in a lawsuit.

Besides keeping your fingers crossed, the surest and most efficient method of limiting a company’s potential loss or overbearing liability is the implementation of a comprehensive business travel accident (BTA) program which can include accidental death insurance, dismemberment insurance, accidental disability insurance, medical evacuation benefits and accident medical insurance.  Corporate BTA plans are designed to insure the employees and owners who travel on behalf of a company for business purposes.  Policies are available on an individual, “specific” group or “blanket” group basis and can be designed to cover risks in any country on the planet including war zones and nations rooted in political turmoil and terrorism.

Policies offered by Petersen International are very flexible and can be molded and augmented to suit the desires of a human resources team or employee benefits manager.

Call us today at (800) 345-8816 to learn more about the thorough business travel accident programs available from Petersen International.

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Layering Benefits to Effectively Safeguard Income https://www.piu.org/communicators/layering-benefits-to-effectively-safeguard-income-2 Tue, 27 Feb 2024 15:00:00 +0000 https://www.piu.org/?p=7562 Common sense and assumption based on experience in the life and health insurance industry have led me to the realization, which I’m certain most of you have witnessed and will wholeheartedly agree upon, that most clients and hopeful prospects—most, not all—are in no way proactive when it comes to their insurance needs.  No matter how […]

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Common sense and assumption based on experience in the life and health insurance industry have led me to the realization, which I’m certain most of you have witnessed and will wholeheartedly agree upon, that most clients and hopeful prospects—most, not all—are in no way proactive when it comes to their insurance needs.  No matter how financially savvy a consumer believes they are, many tend to aim for a path of least resistance and lowest cost when it comes to the contemplation of purchasing insurance even though they may recognize that a claimable “event” could spell utter disaster from an economic standpoint.  And in no industry sector is that more clear and relevant than with income protection—disability insurance.

Without financially protecting one’s paycheck, men and women stand to lose their single most vital source of economic freedom.  Regularly-earned income provides for the necessities of one’s lifestyle and of one’s family—it allows for food, shelter, utilities, transportation, education, healthcare as well as the other numerous bills and costs the average American encounters on a daily basis.  Income also provides for the luxuries and niceties that we often take for granted like vacations, entertainment and recreation costs.  Unfortunately, most Americans making up today’s workforce are insufficiently covered by some, if any, form of income protection insurance.

It’s inherently natural to disbelieve in one’s own morbidity and physical demise, yet statistics show that a healthy person is at least three times more susceptible to disablement from accident or sickness than to death during their career. Disability insurance is quite often overlooked or simply an afterthought, and that needs to change in this country.

The U.S. Department of Labor and DI experts throughout the country have maintained for decades that a working American should have at least 65% of his/her income insured in the hopes of providing for one’s family during a period of total disablement.  Some high-limit DI carriers, in certain cases, are now participating with coverage up to 75% of one’s income if any in-force benefits happen to be taxable to better allow for more substantial income protection.

Disability insurance is a necessity, and having less than 65% of income insured isn’t prudent nor viable financially if and when a disablement occurs.  Insurance is all about preparation for the unknown and planning for the worst case scenario.  A vast majority of Americans, even the wealthy, fail to maintain significant savings and liquid assets in cases of emergencies like unforeseen disablement.  Retirement programs are certainly gaining a stronger foothold among the masses—more people in this country are planning for their futures after retirement, but they are severely lacking in protection for the here and now during their working careers.

Underinsurance provides a false sense of security for which you don’t want to be responsible.  As an advisor you owe it to your clientele to get them appropriately insured to high-limit DI levels so they can economically care for themselves and their families if they were to suffer a short or long-term impairment.  You are not selling them just another redundant piece of paper.  You are providing them with financial freedom from potential disaster.

The disability insurance needs obviously vary from client to client depending upon occupation, age, income and lifestyle.  In my experience, many prospective clients require a layering approach to DI protection with the employment of multiple insurance policies over varying platforms.  Income protection isn’t black and white.  There typically isn’t one simple solution, no one formula for success.  By nature and historical limitations of the market, one DI policy or one product just isn’t going to cut it.  There are actually multiple levels of disability insurance, and all can be extremely important to your clients.

The first level or layer is group insurance, better known as LTD (long-term disability).  Many U.S. employers provide small layers of mandatory or voluntary guaranteed-issue group LTD benefits.  Since the carriers of such plans offer terms on a guaranteed basis, underwriter guidelines commonly limit benefits to 50% to 60% of income with usual caps of $5,000 to $15,000 per month.  For the majority of blue-collar workers and governmental employees, employer-sponsored group insurance combined with state disability benefits provides acceptable income replacement coverage.  But most of the workforce in this country are employed by small business owners, are self-employed or are independent contractors.  In these instances, group disability insurance is oftentimes not available or isn’t sufficient on its own.

The second layer of income protection is IDI (individual disability insurance).  Those without group DI or without a sufficient level of group DI can seek individual disability insurance from a handful of large, reputable U.S. carriers.  These insurers employ individual underwriting and morbidity analysis to provide prospects with policies similar in comprehension to group LTD certificates.  Most Americans can find acceptable levels of disability coverage from a combination of group and standalone individual benefit sources.

However, there are many income-earners in this country that have salaries in ranges that cannot be effectively covered by group and/or standard individual disability policies.  That brings us to a third layer of DI.  Most in the white-collar market as well as physicians and dentists, and many in the rapidly-expanding grey-collar market have annual earnings that can hardly be insured by such a combination of group insurance and a single, traditional disability income policy. 

Consider an executive making $300,000 per year.  Is a group LTD plan providing 60% of income up to $10,000 per month going to allow enough protection to maintain that person’s lifestyle or the lifestyles and financial needs of their spouse and children?  Families with a high-net worth require more insurance than most, as their average expense ratio is significantly higher than an average household.

The third tier is comprised of high-limit DI and is only accessible through the Surplus Lines market and specialty carriers like Lloyd’s of London which specializes in providing income protection above the usual disability benefit limitations of most U.S. carriers.  High-limit or “excess” disability insurance is readily available on a fully-underwritten, individual basis as well as for groups large and small on a multi-life guaranteed-issue basis. 

For moderate to high-net-worth individuals, the risks of underinsurance can prove to be severe and financially disastrous.  Your clients need to understand the importance of the varying layers of income protection, and with your guidance, properly tier and layer supplemental benefits on top of existing group and/or individual policies.  Safeguarding 50% of one’s income is not enough.  Safeguarding 60% of one’s income is not enough.  The multi-layer benefit approach to disability insurance will successfully fill the subtle and blatant gaps in your clients’ risk exposure.

–Published with permission from Broker World Magazine.  

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Ideas to Accelerate Your DI Sales https://www.piu.org/communicators/ideas-to-accelerate-your-di-sales Tue, 20 Feb 2024 15:00:00 +0000 https://www.piu.org/?p=7553 Although income protection has historically been an often overlooked, undervalued component of the life and health insurance industry, the disability insurance marketplace is where we find fresher and greater opportunities than in most other industry sectors.  Recent increases in industry-wide competition, a general stabilizing of the greater marketplace as well as advances in underwriting automation, […]

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Although income protection has historically been an often overlooked, undervalued component of the life and health insurance industry, the disability insurance marketplace is where we find fresher and greater opportunities than in most other industry sectors.  Recent increases in industry-wide competition, a general stabilizing of the greater marketplace as well as advances in underwriting automation, digital marketing and online sales have allowed for the strongest, most progressive DI market the U.S. has seen in decades.  Now is the time to step outside your comfort zone and hone your disability insurance sales skillset.

So, what is important when it comes to selling disability insurance?  The first thing to remember is that DI doesn’t sell itself.  The insurance producer is the most important part of the sales equation.  Your wholehearted belief in the product is key in relating to your clientele that DI is the cornerstone of a healthy and comprehensive financial portfolio.  Without the protection of one’s income, one’s paycheck, nothing else will fall into place economically, and one risks financial ruin.  As an advisor you must actively sell DI to your clients, illustrating how the risks are real and potentially devastating. 

Providing a product brochure or a sales link on your website just won’t cut it.  The average American must be guided early and often to disability insurance because most of us have somewhat of a “Superman” complex.  The average American holds the instinct that he or she isn’t fallible, and the risk of becoming totally disabled and not being able to work is slim to none.  I can assure you that is a complete fallacy. 

Next, be sure to diversify your marketing.  One brochure, one newsletter, one email blast, one mailer is not going to bring you the results you want.  Hit your prospects over the head with many ideas, coming at them from different angles among differing media.  Industry magazine articles, mailers and print ads are institutional and they work.  But also, don’t hesitate to jump into the 21st century by exploiting social and digital media options.  A blog or Facebook post may seem informal and not polished in a traditional sense, but you are trying to reach younger prospects who never put down their cellphones or laptops.  And reaching out on social media just might hit all the right buttons.

Lastly, don’t let your comfort level pigeonhole you into obscurity.  I am quite aware of many colleagues who aren’t willing to look outside that little box in which they do most of their business.  They end up making a comfortable living, but they tend to pass on new ideas and products that come their way, allowing for mediocrity.  Don’t be afraid of blurring lines and crossing over at times.  If you are in individual DI sales, don’t pass-up group cases or employee benefits opportunities that cross your radar just because of a lack of familiarity.  Turn that single attorney excess DI sale into a multi-million-dollar, multi-life guaranteed issue sale on the entire law firm.

There are so many new ideas and avenues in the DI world at this time.  It is an exciting market to be in, and if you heed these ideas in full or in part and make some new ones of your own, you can absolutely make a significant difference in your bottom line selling disability insurance.

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Areas in Conflict https://www.piu.org/communicators/areas-in-conflict Tue, 13 Feb 2024 15:00:00 +0000 https://www.piu.org/?p=7545 It has been almost two years since the Russian army invaded Ukraine, sending those nations into a perpetual state of war.  Ground assaults and shelling of military targets continue to destroy and disrupt Ukraine’s infrastructure.  Offensives by Ukrainian and Russian forces occur from time to time, and unfortunately, the number of casualties on both sides […]

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It has been almost two years since the Russian army invaded Ukraine, sending those nations into a perpetual state of war.  Ground assaults and shelling of military targets continue to destroy and disrupt Ukraine’s infrastructure.  Offensives by Ukrainian and Russian forces occur from time to time, and unfortunately, the number of casualties on both sides of the conflict is significant.

Further south, Israel is once again at war after Hamas militants attacked Israeli civilian populations along Gaza Strip border areas on October 7, 2023.  In retaliation, Israeli forces continue to bombard militant strongholds in Gaza, further straining Palestinian/Israeli relations.

In these many months since the beginning of the invasion of Ukraine, American companies have been sending employees on a regular basis to Eastern Europe including Ukraine and surrounding countries to assist the millions in need and to provide logistical, consulting and training services to governmental and private Ukrainian entities.  Foreign aid workers, physicians, drone pilots, surveillance technicians, security contractors, journalists, healthcare personnel as well as those assisting in the diaspora of refugees continue to travel to Ukraine. 

In Israel, foreign news outlets are sending correspondents to Gaza and throughout much of the rest of the country as hostilities continue there.  American healthcare workers including doctors are also frequently flying to Israel, volunteering their time to help those affected by the ongoing skirmishes and destruction.

Thousands of Americans are risking their lives traveling to these countries and they are seeking insurances to help indemnify the obvious hazards and potential losses associated with working and residing within a war zone.

Petersen International is currently offering accidental death insurance with war and terrorism benefits, medical evacuation coverage, disability insurance, repatriation coverage, travel medical insurance as well as kidnap and ransom benefits to U.S. residents and employees of U.S.-based companies needing financial protection during their travels to Ukraine, Israel and surrounding locales.

To hear more about the Petersen war zone product portfolio as well as how we can financially protect your clients who may be putting themselves in harm’s way, give us a call at (800) 345-8816.

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Your Best Resources for New Business https://www.piu.org/communicators/your-best-resources-for-new-business Tue, 06 Feb 2024 15:00:00 +0000 https://www.piu.org/?p=7531 Now into the new year and as we move into tax season, it is the perfect time to stir up new insurance business among your own client lists.  Believe me, there are plenty of potential sales and premiums awaiting you in those files.  Familiar names and faces make for great clients, repeat customers and excellent […]

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Now into the new year and as we move into tax season, it is the perfect time to stir up new insurance business among your own client lists.  Believe me, there are plenty of potential sales and premiums awaiting you in those files.  Familiar names and faces make for great clients, repeat customers and excellent referrals.

Make a diligent effort to review the insurances owned by your clients and to request a meeting, to get back in front of them so you can illustrate where their coverage may be lacking or even non-existent.  It doesn’t matter if they are medical, business, disability or life insurance clients; getting a fresh chance to pitch them and show them that you care and may be concerned about their financial protection is what’s most important.

Here are some points to keep in mind while prospecting amongst your own clientele:

  • Don’t feel like you are imposing on your clients’ time.  Yes, many of them might be busy business professionals, but your goals for their financial needs are very important and could be life-changing economically.  You are an expert in your field and your guidance is imperative to the financial protection of your clients’ families. 
  • You’re not a faceless, cold-calling salesperson out to make a buck.  You know the personalities behind the names in your files.  You have proven yourself to them in the past, and they have previously chosen your services.  They should be more inclined to trust that you can help once again.
  • Refer to current events to get yourself back in the door like rising interest rates and how it is affecting insurance and financial markets.
  • Use hot-button insurance topics like guaranteed-issue and excess disability insurance or changes in healthcare regulations to drive renewed interest from your clients.  Show them that you are on the cutting edge and have access to the most progressive of insurance products.  You have fresh, exciting ideas that will further secure their lives.
  • Don’t hesitate to cross sell.  Now may be the opportune time to prescribe key person or overhead disability coverage to your personal life clients.  And vice versa, introduce your disability clients to key person life insurance and loan indemnification.
  • Be sure to up-sell.  Most Americans are underinsured when it comes to life and disability coverage.  As an insurance professional, you owe it to your clients to familiarize them with the inherent risks of not having at least 65% to 75% of their income insured as well as having sufficient levels of life insurance to protect not only their loved ones, but also their businesses.

The best leads can be found amongst your current clients.  You are probably already familiar with much of their financial, health and social backgrounds, and these prospects know you.  As long as your previous interactions were successful, you should have a downhill journey to making more business come from these comfortable relationships.  

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Severance Disability Solutions https://www.piu.org/communicators/severance-disability-solutions Tue, 23 Jan 2024 15:00:00 +0000 https://www.piu.org/?p=7506 As corporate takeovers, mergers and acquisitions continue to be regular occurrences in many business markets, occasional workforce reorganization and downsizing throughout most industries are inevitable.  Most importantly for employment liability safeguards, tactful and conscientious business owners will provide comprehensive severance packages at the moment of termination to assist the severed employee through that often-difficult life […]

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As corporate takeovers, mergers and acquisitions continue to be regular occurrences in many business markets, occasional workforce reorganization and downsizing throughout most industries are inevitable.  Most importantly for employment liability safeguards, tactful and conscientious business owners will provide comprehensive severance packages at the moment of termination to assist the severed employee through that often-difficult life transition.

Employment severance agreements typically include but are not limited to the following: additional income in regularly scheduled terms of months or years, payment for unused vacation time or sick leave, stock options, retirement benefits and limited continuation of life, dental, medical and disability insurances.

Employee benefits are financially imperative to millions of Americans.  Most have become economically dependent upon employer-sponsored insurances that not only serve to protect the covered employee but may reach to protect that employee’s immediate family as well.  Often taken for granted by those the programs benefit, the corporate expense of maintaining such employee benefits can be fiscally straining to any company, no matter the size.  But as previously mentioned, dutiful employers may extend coverage through a severance arrangement.  And therein lies the problem.

Group insurance carriers require the immediate removal of a severed employee from an employer-sponsored plan with the possible offer of conversion to individual coverage.  Family or individual life, dental and medical insurance policies are available from any number of insurance companies.  Disability coverage is the exception.  Without future employment contracts in place, traditional disability carriers will not insure an unemployed person no matter how recently that person was terminated.  Since most employers and severance agreement drafters are not always aware of this dilemma, they frequently open themselves to additional liability risks and possible threat of litigation.

Petersen International is able to assist employers, your business clients, in mitigating such liabilities and avoiding the unnecessary and potentially expensive need for self-insurance.  The Petersen International Severance Disability Insurance Plan provides a severed employee with long-term disability benefits which can be sculpted to fit the insurance requirements of a legal severance agreement. 

Contemplating loss of employment or the letting go of an employee isn’t usually a comfortable practice, but the need for downsizing and restructuring will continue to be prevalent in corporate America. Contact our disability department at (800) 345-8816 for more information about severance insurance for your business clients.

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Some Thoughts on Disablement, Disability Insurance and the International DI Society https://www.piu.org/communicators/7484 Tue, 16 Jan 2024 15:00:00 +0000 https://www.piu.org/?p=7484 Imagine being a single mother of 4 children and becoming disabled at the age of 45.  This is a story that I lived when my mother became ill and could no longer work.  She was a strong willed, intelligent woman who enjoyed her career as the only female high-level executive at the Tech company she […]

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Imagine being a single mother of 4 children and becoming disabled at the age of 45.  This is a story that I lived when my mother became ill and could no longer work.  She was a strong willed, intelligent woman who enjoyed her career as the only female high-level executive at the Tech company she worked for.  The good news was that she had Group Long Term disability coverage through her employer. The bad news was that the benefit had a low cap, was taxable and did not provide enough income for her to live without help from her children.  My mother quickly sold the home she worked hard to buy and moved into a 700 square foot in-law apartment where she lived out her life. It was hard for her; it was hard for us.  She was close to becoming an empty nester and excited to start a new life focusing on herself until her illness struck out of nowhere.

One of the most unsettling issues was that she was underinsured, and the group benefits consultant did not identify this issue.  It’s likely that all the top executives in this Tech company were all grossly under-insured.  She also had an insurance agent who never brought up the need for more income protection. He only talked about Life Insurance. 

Unfortunately, this story happens more often than you probably think. The Council for Disability Awareness (disabilitycanhappen.org) reports that:

  • At least 51 million working adults in the United States are without disability insurance other than the basic coverage available through Social Security.
  • Accidents are NOT usually the culprit. Back injuries, cancer, heart disease and other illnesses cause the majority of long-term absences.
  • Only 40 percent of US households have enough in liquid savings to cover at least three months of their recurring expenses, and only 28 percent can cover at least six months.
  • A 2019 study of consumer bankruptcy filings found that 77.8% of debtors cited income loss as a contributor to their bankruptcy. This included 44.3% specifically citing medically related work loss as a contributor.

The good news is that there is a group of individuals who focus on providing education, training and support to those producers who want to take this as an opportunity to help their clients understand the risk of not adequately protecting their ability to earn an income.  Each year this group embarks on a 2-day conference led by the International DI Society https://internationaldisociety.org. The International DI Society (IDIS) is an organization whose members dedicate themselves to providing disability insurance to individuals, families, business owners and employers to afford financial security in the event that an unforeseen disability occurs.  They are devoted to growing consumer awareness and enhancing the disability insurance industry by expanding resources, remaining current on industry trends, and providing a community for producers, distributors, underwriters and carriers to establish relationships and drive innovation.  The 2023 conference provided a robust agenda which included sessions on; Underwriting Innovation, LTD & IDI Combo Sales, Guaranteed Standard Issue and how to Present like a Pro.  This was followed by a main stage speaker who shared his story of how Individual Disability Income Protection helped his family keep their home, cars and pay their bills while he was disabled and could not work and earn an income. The conference also provides several opportunities to network, learn about tools to help grow sales and reach consumers, legislation, underwriting, state of the business and motivational speakers.  This conference is open to anyone interested in learning about Individual Disability Insurance.   

Passion is an innate behavior developed by past experiences whether they were positive or negative.  You can be passionate about the chocolate cake you had for dessert or your career.  Many who have witnessed a parent, friend or relative become disabled in their past are often passionate and driven about spreading the message around the importance of protecting one’s income in the event of a disability. We need more passionate representatives in this industry.

–Published with permission from On the Risk magazine.

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A New Year and New Projected Highlights https://www.piu.org/communicators/a-new-year-and-new-projected-highlights Tue, 09 Jan 2024 14:59:00 +0000 https://www.piu.org/?p=7479 Happy New Year!  2023 sped by and is one for the record books.  It proved to be a prosperous year with growth along most insurance lines of the specialty markets. More than we anticipated.  Individual disability and group GSI numbers climbed while there was a slight slowing along life and accident insurance sales which was […]

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Happy New Year!  2023 sped by and is one for the record books.  It proved to be a prosperous year with growth along most insurance lines of the specialty markets. More than we anticipated.  Individual disability and group GSI numbers climbed while there was a slight slowing along life and accident insurance sales which was most likely due in part to an industry-wide easing of COVID protocols in the domestic life space over the last 12 months.  Now let’s look ahead to what we can hope for from the disability and specialty lines markets over the next 12 months.

The previous hardening of the Lloyd’s market has mostly halted, and rates have plateaued.  Underwriting syndicates have once again begun to cautiously loosen more-conservative underwriting methodologies that came about during the COVID era.  There are still no signs of a swing to a truly soft market in the near future, but it is comforting to see more specific boundaries being set by the risk takers, allowing us to better anticipate underwriter expectations and marketplace reactions.

This year we foresee a continued evolution of the famed Lloyd’s GSI disability space with a focus on long-term product viability where rates and benefit limits will find a harmonious middle ground to help keep the product line profitable.  Group guaranteed-issue excess disability insurance has been a huge premium builder for the market over the last decade and has stolen some of the spotlight from the personal accident market’s bread and butter – fully-underwritten personal disability insurance.

2024 will see continued growth in individual personal DI sales and underwriting.  By all accounts, the historically successful physician, attorney, executive and accountant demographics will still shine as prospective clientele, but this year we will continue to see more out of high finance and the private equity space, as well as some fringe industries like cannabis and digital entertainment sectors, including the likes of internet and social media celebrities.

Professional and collegiate athletics will maintain its loyal niche in the market, but we anticipate seeing more interest from the carriers in insuring NIL (name, image, likeness) deals as that space evolves.

We also anticipate continued risk diversification this year with further expansion into the middle markets, targeting excess limits and impaired-risk disability benefits for gray collar employees not covered by governmental benefits.

Aside from disability insurance, we plan to heavily market the successful Failure to Survive product line which provides key person death benefits for businesses as well as buy/sell and business loan situations.  Impaired-risk retention and quick simplified policy issuance are the key selling points, making FTS one of the best financial tools in the specialty insurance markets today.

Despite the ever-present national and global concerns for inflation, potential recession and speculative financial and real estate market tumbles, the specialty disability and life markets remain active and attractive arenas for consumers seeking unique insurance solutions.

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How DI Is Integral to Estate Planning https://www.piu.org/communicators/how-di-is-integral-to-estate-planning Tue, 19 Dec 2023 14:56:00 +0000 https://www.piu.org/?p=7472 In the most fundamental teachings of life and health insurances, we learn early on that life insurance creates an immediate estate and annuities assist in liquidating an estate.  But what financial tool safeguards an estate during those oh so important income accumulation years while a person’s economic interests build, ride the inherent market ebbs and […]

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In the most fundamental teachings of life and health insurances, we learn early on that life insurance creates an immediate estate and annuities assist in liquidating an estate.  But what financial tool safeguards an estate during those oh so important income accumulation years while a person’s economic interests build, ride the inherent market ebbs and flows, rebound if necessary and hopefully grow a substantial wealth foundation to leave to future generations?  The answer is disability insurance of course.

Widely accessible and sophisticated savings vehicles like 401(k)’s, Roth IRA’s, annuities and cash value life insurance programs allow Americans to begin planning for secured financial futures.  These plans have proven to permit reliable income streams beyond volatile high-yield market investments and sedentary, sluggish bank savings and money market accounts as well as social security benefits, a program that’s future and longevity are highly suspect.

Although reputable savings vehicles are readily available to corporate America, the sad reality is that most Americans still don’t save enough in earned assets throughout their lifetimes and typically live paycheck to paycheck or close to it.  Exacerbating this frequent dilemma is that little significant regard is given by most to financial planning beyond their working years.  This is a predicament that can absolutely become economic catastrophe when a working individual suddenly or even gradually becomes disabled during that ever-so-important first half of life, the years when wealth is typically accumulated.

Most of us work for a living to earn a regular paycheck, providing food, shelter, clothing, education, healthcare, other insurances (including life and disability) and transportation – the usual requisites of successful living in this country – for ourselves and our dependent families.  Hopefully, after the bills and taxes are paid, a portion of income is leftover for simple luxuries, perhaps vacation travel or to be dutifully deposited into a savings vehicle.  We are dependent upon our paychecks to not only provide for us today, but to allow the aggregation of wealth that will not only provide for comfortable lives in our senior years, but also the ability to maintain a looked-after and planned estate.

But asset building and income savings only happen when there is an inflow of cash.  Trouble begins when the anticipated earnings halt or are completely terminated, which is a common result of disablement.  Without proper disability insurance and income protection, there is no sufficient planning for a survivable estate.  You can’t plan for the future without safeguarding the present.

The greatest weapon in combatting short-term, long-term, partial, total, temporary or permanent physical incapacitation due to sickness or injury is comprehensive disability income insurance prescribed in sufficient amounts.  Personal disability insurance programs come in many shapes and sizes, but most industry experts agree that a layering of multiple “own occupation” defined income protection insurances to at least 65% of personal income is adequate, providing continuation of at least a semblance of one’s pre-disability lifestyle.

The layered effect of income protection typically takes shape under varying tiers of employer-sponsored group disability programs, individual disability plans as well as specialty-market excess, high-limit disability platforms or some reasonable combination thereof.  Importantly, insurance company disability benefit calculations typically allow for the inclusion of 410(k) employee contributions, keeping much of an earned salary intact including retirement allocations when an employee becomes disabled.

Personal disability insurance is the foundation of sound financial planning, retirement planning and estate planning as it provides the first line of defense of income, and financially safeguards the consumer’s arduous journey to saving for future life stages and beyond.

Ancillary income protection products from specialty-market carriers can also assist in directly fortifying an estate.  The Lloyd’s of London market offers bespoke programs like retirement funding completion insurance as well as stock option protection insurance.  Both of which protect career earnings to thwart off retirement-benefit collapse in case of premature disablement.

Retirement funding or pension completion insurances are standalone defined-contribution protection plans that provide an insured person with a lump sum of cash for the anticipated balance of aggregate retirement plan contributions at the time of permanent disablement.  These resources are unique in that both employee and employer contributions may be included in the benefit calculations.

The stock option protection plan is a standalone disability program that insures anticipated stock option awards for those working for publicly-traded corporations who would stand to lose future stock option compensation in the face of disablement.  A stock option plan pays a permanent disability lump sum benefit equivalent to a multiple of anticipated annual stock option awards.

Personal estate planning can also be heavily influenced by business assets.  Business owners have additional fiduciary needs and potential financial liabilities when considering business succession and how their physical demise could negatively affect their employees as well as their business partners.

Business loans and corporate debt can certainly pose economic shortfalls for companies faced with the pending physical loss of an owner.  Disability products like loan indemnification insurance and business overhead expense coverage are available to clients in addition to their personal disability benefits.  Both assist in covering outstanding business liabilities including utility and insurance bills and payroll costs while allowing business owners to keep their personal disability benefits intact and appropriately earmarked for familial needs.

From a business owner’s perspective, much of the planning done to meet estate asset goals falls under the category of succession planning.  Agreements are made and contracts are drawn-up with business partners, trusted employees or interested third parties to settle corporate loose ends and eventual buy-outs of ownership interest in case of an owner’s total disablement.

Key person disability insurance is an incredibly flexible tool when it comes to succession planning and business continuation.  The product provides monthly, lump sum or a combination of benefits, so a business hit with the typically devastating loss of a marquee owner can survive and navigate often unfamiliar terrain before an eventual buy-out of the disabled owner takes shape.  Key person policies pump in much needed stabilizing capital which is often used to secure replacement staff, to cover recruitment costs or to help maintain revenues after the sometimes-inevitable loss of key accounts.

But as a key person plan assists in business needs of the short-term, a buy/sell disability policy is the anchor of the succession plan.  Designed to fund the buy/sell agreement between business partnerships and other corporate structures, an executed buy/sell disability policy provides cash payments over a scheduled period of time or in a hefty lump sum for the purchase of the corporate shares of the disabled owner, thus allowing a prudent and financially successful move into retirement and the stabilization of a business owner’s estate and taxation liabilities. 

The purpose of financial planning is to provide a client with a solid foundation of diversified savings, asset management and growth as well as insurance services to maintain a comfortable level of financial freedom into retirement as well as safeguarding accumulated assets that will eventually be passed on after death.  Disability insurances for both personal and business needs are a big part of that foundation by protecting those assets and that savings from the devastation of physically losing the ability to work and earn that accustomed and necessary paycheck.  You can’t properly manage and guard an estate without sufficient disability coverage.

–Published with permission from Broker World Magazine.

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