Product Provisions Source Brokerage, Inc.. Choosing a DI Product Strong company Flexible plan Competitive price.

Product Product ProvisionsProvisions

Product Product ProvisionsProvisions

Source Brokerage, Inc.

Choosing a DI ProductChoosing a DI ProductChoosing a DI ProductChoosing a DI Product

Strong company

Flexible plan

Competitive price

Three Occupation DefinitionsThree Occupation DefinitionsThree Occupation DefinitionsThree Occupation Definitions

OWN OCCUPATION– Unable to engage in “own” occupation. (“True” own occ)

OWN OCCUPATION & NOT ENGAGED – Unable to engage in “own” occupation and not engaged in any occupation for wage or profit. (Modified definition of disability)

REASONABLE OCCUPATION – Unable to engage in any occupation based on education, training or experience.

Basic Policy ProvisionsBasic Policy ProvisionsBasic Policy ProvisionsBasic Policy Provisions

Non-can and Guaranteed Renewable

Guaranteed Renewable

Conditionally Renewable for Life

Basic Policy ProvisionsBasic Policy ProvisionsBasic Policy ProvisionsBasic Policy Provisions

Premiums waived after 90 days

180-day break in waiting period

Surgical transplant

Rehabilitation benefits in addition to monthly DI benefit

Specific or Presumptive Loss

Basic Policy ProvisionsBasic Policy ProvisionsBasic Policy ProvisionsBasic Policy Provisions

Reasonable OccupationReasonable Occupation 24 Months24 Months Own Occ &Own Occ & Not EngagedNot Engaged

24 Months 24 Months Own OccOwn Occ

Reasonable OccupationReasonable Occupation

Plan FlexibilityPlan FlexibilityPlan FlexibilityPlan Flexibility

60 Months Own Occ 60 Months Own Occ & Not Engaged& Not Engaged

Reasonable OccupationReasonable Occupation

6060 MonthsMonths Own OccOwn Occ Reasonable OccupationReasonable Occupation

To Age 65 Own Occ (Pure or True)To Age 65 Own Occ (Pure or True)

To Age 65 Own Occ & Not Engaged (Modified)To Age 65 Own Occ & Not Engaged (Modified)

DI JeopardyDI JeopardyDI JeopardyDI Jeopardy

How long does the average disability last?

What is the most economical elimination period for professional occupations?

Which definition of disability enables the policyholder to collect disability benefits while he/she is engaged in another gainful occupation?

RidersRidersRidersRiders

Residual/Partial

24-Month Residual/Partial

6-Month Residual/Partial

Residual & Partial RidersResidual & Partial Riders

Full BenefitFull Benefit Proportional BenefitProportional Benefit NoNo BenefitBenefit

0%-20%0%-20% 20% - 80%20% - 80% 80% - 100%80% - 100%

Long-Term & 24-Month Long-Term & 24-Month Residual RidersResidual Riders

Long-Term & 24-Month Long-Term & 24-Month Residual RidersResidual Riders

20% loss of prior monthly earnings

Unable to perform one or more of the material and substantial duties of your occupation; or

Unable to engage in your occupation for 80% of the time, as was usual prior to the start of your disability.

Inflation RiderInflation RiderInflation RiderInflation Rider

Inflation RiderInflation RiderInflation RiderInflation Rider

Increases benefit while policyholder is

disabled and collecting benefit

CPI-U linked

Up to 6% compounded

Social Insurance Social Insurance Substitute RiderSubstitute Rider

(SISR)(SISR)

Social Insurance Social Insurance Substitute RiderSubstitute Rider

(SISR)(SISR)

Integrate With Social SecurityIntegrate With Social SecurityIntegrate With Social SecurityIntegrate With Social Security

Purpose: Lowers monthly premium

• Client eligible for $5,000 monthly benefit

• Base Benefit = $4,000

• SSI Benefit = $1,000

SISR Benefit PaymentSISR Benefit PaymentSISR Benefit PaymentSISR Benefit Payment

Claim Example 1

Maximum Benefit = $5,000

SS pays $1,000

Base Benefit pays $4,000

Total Monthly Benefit $5,000

$-for-$ offset$-for-$ offset

SISR Benefit PaymentsSISR Benefit PaymentsSISR Benefit PaymentsSISR Benefit Payments

Example 2

Maximum Monthly Benefit $5,000

SS pays None

Base Benefit = $5,000

Total Monthly Benefit = $5,000

Automatic Increase RiderAutomatic Increase Rider(AIR)(AIR)

AIRAIRAIRAIR

Increases benefit while policyholder is

working

3% annual increase for 5 years

No financial or medical evidence required

Additional 5-year benefit option available

with proof of insurability

Guaranteed Physical Guaranteed Physical Insurability Rider (GPIR)Insurability Rider (GPIR)

or Future Purchase Option or Future Purchase Option (FPO)(FPO)

Guaranteed Physical Guaranteed Physical Insurability Rider (GPIR)Insurability Rider (GPIR)

or Future Purchase Option or Future Purchase Option (FPO)(FPO)

GPIR or FPO GPIR or FPO GPIR or FPO GPIR or FPO

No medical evidence required when exercising increases

Must provide financial verification for increased benefit such as W-2, pay stub or tax return

DI JeopardyDI JeopardyDI JeopardyDI Jeopardy

• In what instances will a person be eligible for Social Security disability benefits?

• Which rider increases the monthly benefit if the policyholder is working?

• What is the window of time a disability can reoccur without requiring the claimant to satisfy a second elimination period?

Exclusion LimitationsExclusion LimitationsExclusion LimitationsExclusion Limitations

Incarceration

War or act of war

Undisclosed pre-existing conditions

Intentional self-inflicted injury or sickness

24-Month Drug, Alcohol, Mental and Nervous Endorsement, unless hospital confined

Exclusions/LimitationsExclusions/LimitationsExclusions/LimitationsExclusions/Limitations

Competitive Premium FeaturesCompetitive Premium FeaturesCompetitive Premium FeaturesCompetitive Premium Features

Competitive Premium FeaturesCompetitive Premium FeaturesCompetitive Premium FeaturesCompetitive Premium Features

25% Tobacco Differential

15% - 20% Multi-Life Discount

15% Association Discount

Unisex and Sex-Distinct Rates

DI JeopardyDI JeopardyDI JeopardyDI Jeopardy

Are DI premiums more expensive for men or women?

What affect does the SSI rider have on the DI premium?

What is the most common reason people give for not purchasing a disability income policy?

Business Protection PlansBusiness Protection PlansBusiness Protection PlansBusiness Protection Plans

Business Overhead Expense- coversBusiness Overhead Expense- coversoverhead expenses while owner is overhead expenses while owner is

disabled, if there is a loss of income.disabled, if there is a loss of income.Buy/Sell- if one owner becomes disabled,Buy/Sell- if one owner becomes disabled,

buys out the partnership for the other buys out the partnership for the other owner/ownersowner/owners

Business Overhead ExpenseBusiness Overhead ExpenseBusiness Overhead ExpenseBusiness Overhead Expense

Expenses Covered:• Employees’ salaries• Utilities• Rent• Salary for business owner’s temporary

replacement (usually 6 months)• Interest payments on business debt

Business Overhead ExpenseBusiness Overhead ExpenseBusiness Overhead ExpenseBusiness Overhead Expense

Expenses not covered:

• Policy-owner’s salary

• Renovations to office or expansions of the business during disability

DI JeopardyDI JeopardyDI JeopardyDI Jeopardy

What is a good rule of thumb to determine if an expense is covered under Business Overhead Expense (BOE) policy?

What is the longest benefit period available in a Business Overhead Expense (BOE) policy?

Multi-Life DI PlansMulti-Life DI PlansMulti-Life DI PlansMulti-Life DI Plans

Guaranteed Standard Issue (No Medical Underwriting) with premium discounts for employer-paid and voluntary benefit programs.

Benefits for ClientBenefits for ClientBenefits for ClientBenefits for Client

• Supplements LTD benefits with individual plan to insure 90% of the net

income.

• Unisex rates

• No medical underwriting

Benefits for ProducerBenefits for ProducerBenefits for ProducerBenefits for Producer

• Build upon existing LTD programs

• Simplified underwriting and application process. – Census– No medical underwriting

Maximum Issue LimitsMaximum Issue LimitsMaximum Issue LimitsMaximum Issue Limits

Varies based on the number of participants. Some carriers will offer plans on GSI basis for as few as 5 executives and up.

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