U . S . disability carriers commonly maintain insurance participation limits that discriminate against high-net-worth individuals ... Specialty disability marketplaces like Lloyd ’ s of London must be tapped to properly accommodate .
The most prevalent of offerings to the high-net-worth prospect is that of individual , excess high-limit disability insurance . Target demographics include physicians and surgeons , attorneys , accountants , c-suite executive classes , professional athletes as well as those working in the entertainment industry either as spotlighted talent or executives behind the scenes .
Casting a broad net
The high-limit DI niche casts a broad net to serve anyone with substantial earnings who doesn ’ t have substantial amounts of income replacement insurance . Group and domestic individual plans allow for longer policy terms and longer benefit periods , so it is always advised that is where an advisor should begin their search for product , but then access the specialty markets to accomplish those recommended goals of 65 % to 75 % of income replacement with supplemental , excess DI .
Recent iterations of excess DI in the contemporary marketplace have also evolved into group chassis aimed at firms with a number of employees requiring additional insurance . The development of Guaranteed Standard Issue insurance programs has become a very hot ticket for the specialty DI market , allowing employees of accounting firms , law practices , medical groups , and other large corporations to acquire robust excess DI benefit limits on a guaranteed-issue basis while still affording the employers grand multi-life discounts and human resources departments with the ease of online program implementation and simplified administration . High-limit GSI programs are a dream for employee benefits advisors because of the substantial commissions and the attractive nature of the insurance itself to corporate employers as a significant employee retention tool .
Stock option DI plans
In addition to typical salary and bonus income indemnification standard among most disability carriers , specialty insurers in the high-limit niche also offer separate , standalone disability programs that specifically insure employer-granted stock options for high-net-worth individuals employed by publicly traded companies . Stock option DI plans have proven in recent years to be advantageous ancillary products for clientele whose income is mostly dependent upon vested stock options .
Aside from personal disability insurance , the high-limit niche offers numerous unique opportunities for business owners as well . Once again , the specialty markets deliver where domestic programs stop . Excess , high-limit buy / sell disability policies are available to help fully fund large corporate succession agreements , including prospects over the age of 60 as well as impaired-risk clients . Excess business overhead expense insurance , business loan insurance and key person DI programs are also readily found in the specialty markets at participation limits well above those of domestic disability companies .
Ultimate safeguard
The generally liberal underwriting methodologies and product flexibility of specialty-market carriers affords great business opportunities for those working in the high-limit DI niche . As an astute insurance advisor , provide your clients with guidance and the proper knowledge that unforeseen disablement is a sobering reality of millions of Americans every year , and high-limit disability insurance is the ultimate safeguard of familial financial catastrophe .
High-net-worth individuals may not seem to exhibit the most obvious needs for income protection , but prospective clientele making over $ 250,000 annually stand to lose more because they simply have more to lose . www . nailba . org 45