As the old saying goes, “When opportunity knocks, open the door.” And one trend in the disability insurance marketplace – Guaranteed Standard Issue Individual Disability insurance – has plenty of opportunities knocking.
In fact while health reform is creating a painful income gap for many insurance producers, GSI is what we fondly refer to as the “Other PPACA” – the Paycheck Protection Commission Advancement program.
Is it time to redefine your PPACA’s impact on your earnings?
If you’re not already offering this coverage to your employer clients, you might be missing out on a real DI sales sweet spot. After all, this coverage offers you the chance to sell multiple disability income policies to a single client without the burdensome financial and medical underwriting associated with other disability policies.
The drawbacks of traditional Group LTD plans
Group Long Term Disability is one of the least expensive ways for employers to provide coverage to their employees. But as you know, “least expensive” generally means “least comprehensive” when it comes to insurance. And if one of your clients’ employees becomes disabled and is only covered by a traditional group LTD plan, that employee will never receive anything close to his or her full pre-disability pay due to benefit limits and taxes. Also, employees who leave their companies have to give up their disability insurance, since they can’t take the group plan with them. And for employers, premiums on Group LTD usually go up over time.
Who needs GSI?
GSI plans can be a convenient alternative – or addition – to a group LTD plan for businesses with as few as five employees. A supplemental plan is particularly recommended for highly paid and executive employees. Group LTD plans often cover as little as 30 to 50 percent of highly-paid employees’ compensation. When you consider that the benefit is taxable and that only the executive’s base income is covered by the group LTD plan, it’s not uncommon for a company’s executive team to have less than half of take-home pay protected.
The golden opportunity
And this gap in protection presents a golden opportunity for you. Sell your clients on the benefits of layering a Guaranteed Issue Individual Disability Income policy on top of group LTD, which can cover a greater percentage of their high earning employees’ income.
Why GSI is a win-win-win
For employers, GSI plans offer much greater flexibility and can be designed to be employer-paid or voluntary. And offering an individually owned disability income insurance policy can be a great perk for recruiting, rewarding, and retaining key employees. Some other key features of GSI plans include:
- No medical underwriting
- Financial documentation limited to an employee census
- Unisex rates
- Premium discounts
For employees, GSI plans can provide peace of mind by covering a greater percentage of their income at an affordable cost. These plans are also a great alternative for employees who have preexisting conditions that aren’t covered under traditional disability insurance policies.
And for brokers, compensation is significantly higher on GSI plans than group LTD plans – offering a lucrative earning opportunity and great persistency. GSI policies tend to stay on the books, earning you commissions year after year.
If you’re looking for another opportunity to boost your disability insurance sales, try an ideal disability insurance quote option – the GSI Disability Insurance plan.
To learn more about Paycheck Protection Commission Advancement, download our free guide, “The Other PPACA.”
