Do you turn down prospects because they have less than perfect health? It’s time to stop. When you discriminate against medically-impaired disability insurance prospects, you’re not just letting down someone who could really use coverage – you’re also denying yourself a commission that might not be nearly as hard to secure as you think.
The Myth of the Perfect DI Candidate
When you’re looking for disability insurance prospects, you may have the ideal client in mind – perhaps a young doctor with perfect health and a massive income. However, not all DI buyers fit this mold.
Knowing what your target audience looks like is great for marketing, but make sure you don’t go too far. If you only focus on perfect candidates, you risk overlooking all the other candidates who also need coverage. Ideal candidates don’t need to be doctors, nor do they need to be young and healthy – they just need a paycheck worthy of protection.
The Medically-Impaired Market
The medically-impaired market for disability insurance is huge. According to KFF, as many as 133 million non-elderly U.S. adults may have pre-existing conditions. Plus, around 54 million have pre-existing conditions severe enough that they could have been denied health insurance before the ACA.
You may have assumed that these individuals are also ineligible for disability insurance, but that’s not necessarily true. People with pre-existing health conditions – even serious ones like cancer and diabetes – may qualify for disability insurance coverage.
There’s More Than One DI Policy Option
It’s true that a disability insurance company might reject an application because the applicant has a pre-existing condition. However, this doesn’t mean all insurers will reject medically-impaired applicants.
- Different carriers have different underwriting criteria. A condition that’s an underwriting dealbreaker for one carrier might be no problem for another carrier.
- Not all disability insurance policy types require medical underwriting. An individual disability insurance policy typically requires medical underwriting, which could be a barrier for an applicant with a pre-existing condition. However, other types of disability insurance completely bypass the medical underwriting process.
Simplified Issue and Guaranteed Standard Issue Disability Coverage
If you’re working with a medically-impaired client, you may want to offer simplified issue or guaranteed standard issue disability insurance.
- Simplified issue disability insurance is a good alternative to individual disability insurance. Although the coverage may not be quite as robust as what’s available with an individual disability insurance policy, it’s a practical way to achieve portable paycheck protection, even if you have a pre-existing condition.
- Guaranteed standard issue disability insurance is a great option for groups of five or more employees with the same employer, even if they have different positions in the company. For example, if you’re insuring a dentist’s office, dentists, dental assistants, and receptionists can all participate in guaranteed standard issue disability insurance. In addition to bypassing most of the underwriting that individual disability insurance normally requires, the policyholders may be eligible for a multi-life discount.
Are You Turning Down Disability Insurance Commissions?
People with pre-existing conditions understand the impact of disability and the value of paycheck protection, which makes them great disability insurance candidates. By telling them they don’t qualify for coverage, you’re denying them the paycheck protection they need to protect themselves and their loved ones.
You’re also denying yourself the opportunity for a lucrative commission. When you sell a disability insurance policy, you may earn a commission of up to 70% of the first year’s premium, plus renewal premiums. The more policies you sell, the more you earn. Turning down commissions just doesn’t make sense – and if you’re turning down prospects because they have pre-existing conditions, you’re closing the door on a huge market.
To provide people with pre-existing conditions with coverage, you just need to know what to offer. With some health issues, individual disability insurance may be a viable option, as long as you approach the right carriers. With other health conditions, simplified issue or guaranteed standard issue disability insurance may be the better option.
Do you need help finding coverage for a medically-impaired client? Let DIS help.