Author Archives: Steve Aldrich

Disability insurance can protect you from unthinkable

April 10, 2019 | By Terry Savage | Chicago Tribune

Income tax time brings you face to face with the amount of money you earn — and have left to live on, after taxes. But what if you were disabled and couldn’t work? It’s something no one wants to think about: being incapacitated. But consider the odds.

The Disability Insurance Resource Center says that for a 32-year-old, a serious disability (three months or longer) is 6 1/2 times more likely than death. It also notes that only 3 percent of mortgage foreclosures are caused by death, while 48 percent are caused by disability.

The average disability lasts two to four years, but some people are disabled for life. And that’s where disability insurance comes in. There are basically two ways to purchase disability insurance.

Disability insurance may be offered as part of a group benefit provided by your employer or purchased independently. It costs less when purchased through a company benefits plan, and premiums are usually paid with pretax dollars.

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LTD Insurance Auto-Enrollment: A Potential Tailwind for Market Players

April 17, 2019 | From Business Wire for insurancenewsnet

OLDWICK, N.J.–(BUSINESS WIRE)– A rule clarification that allow employers the option to provide long-term disability coverage to their employees through automatic enrollment should benefit insurers by increasing participation rates, and increased marketing efforts and evolving employee attitudes may increase penetration rates, according to a new AM Best special report.

A recent decision by the U.S. Department of Labor expands automatic enrollment programs in all states to include disability insurance plans, with an opt-out choice, preempting any state laws specifically banning auto-enrollment for the product. The Best’s Special Report, titled, “LTD Insurance Auto-Enrollment: A Potential Tailwind for Market Players,” states that from 2012 to 2017, net premiums written for group long-term disability (LTD) rose more than 30%, to $12.6 billion from $9.7 billion, while the number of covered lives grew 28%. Based on the experience of some insurers already offering the automatic enrollment option in certain states, participation rates could grow by 10% to 15%, with continued growth opportunities in the employer group space.

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Disability Insurance Can Keep One Disaster From Causing Another

An Insurance executive talks about a terrible hole in many of your clients’ planning.

April 12, 2019 | By Wendy Herndon for ThinkAdvisor

A car breaks down during rush hour. A computer malfunction wipes out a key presentation. An alarm clock does not ring on the morning of an important meeting. Inconveniences, yes, but not true disasters, no matter how terrible they may be at the time.

Consider these situations: An employee falls off the roof while cleaning gutters. Another is hospitalized after a major car accident. A third is diagnosed with a serious heart condition. These are all unfortunate situations, yet not in the least improbable — and each event qualifies as a true personal disaster.

Here is something else disastrous: Odds are that just one of those individuals would have supplemental disability insurance in place to help ease financial burdens during treatment and recovery. That is because according to a recent study by One America, only a mere 34% of American workers have disability coverage provided by their employer. Of this number, 43% said the reason for this lack of coverage was because it was not offered at the workplace.

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Disability Insurance: Definition, Why You Need It and How to Get It

Disability insurance is an important component of your overall financial planning efforts. You are more likely to become disabled than to die during your working years, disability insurance can help ensure that you can maintain your lifestyle.

March 22, 2019 | By Roger Wohlner – The Street

Disability insurance should be a key part of your overall financial planning. Insurance is designed to cover losses that are too big to cover with your own out-of-pocket funds. Life insurance provides a benefit to your beneficiaries should you die. Health insurance covers the cost of medical care should you or your family need it. No less important is disability insurance that covers lost income in the event that you are unable to work due to a disabling injury or illness.

What Is Disability Insurance?

Disability insurance could also be called “income insurance.” Disability insurance provides an income stream in the event that you are unable to work for periods of time ranging from short-term to long-term. Disability insurance differs from other forms of insurance like medical or life insurance in that it is specifically designed to replace a portion of your income in the event that you are unable to work for a period of time due to an illness or an injury.

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Life insurance: Do you know what to look for?

Learning more about permanent life options may be a point of differentiation with your employer clients.

March 21, 2019 | By Bonnie Brazzell and Nick Rockwell – BenefitsPro

Recent Eastbridge research has found that while just over half of carriers offer a universal life/whole life (UL/WL) product today, almost a quarter of carriers see UL/WL as a growth product for the industry over the next few years. In addition, UL/WL was the top product (tied with hospital indemnity) listed as most likely to be added to carriers’ voluntary portfolios in the next two years.

Despite carrier investment in developing and enhancing permanent life products, most brokers did not include UL/WL in their top five most frequently sold products. Our joint BenefitsPRO/Eastbridge survey found that four of the top five most frequently sold products are the same for benefit brokers and voluntary brokers. With such similar portfolios, learning more about permanent life options may be a point of differentiation with your employer clients.

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10 tips for selling voluntary and new products

As you work with employers to help them expand their offerings and put together a best-in-class benefits plan, here are 10 tips to keep in mind.

March 6, 2019 | By BenefitsPRO Editors

Have you heard about the labor market? It’s hot, and employers are struggling to attract and keep top talent. This past year saw a significant change in employers’ benefits strategies, as their top priority shifted from controlling costs to competing for talent.

Health insurance, paid time off and flex scheduling continue to be major draws for candidates, but employers are also sweetening the pot with an array of voluntary benefits. The cherry on top might be the ease of access and use of these benefits, making a good benefits administration platform a must.

As you work with employers to help them expand their offerings and put together a best-in-class benefits plan, here are 10 tips to keep in mind.

1. The most successful brokers have long ago cast aside the assumption that employers are not interested in voluntary and have been tirelessly working to understand and align themselves towards employers’ most pressing voluntary-oriented needs. — Bonnie Brazzell, Eastbridge Consulting Group

2. K.I.S.S. (Keep It Simple, Stupid): Negotiate high guaranteed-issue amounts for voluntary benefits. Then, limit choice to those G.I. options. Employees want simplicity in enrolling and employers want a streamlined process. — Kevin Kennedy, TriBen Insurance

3. When voluntary benefit programs are positioned as an integral part of the employee benefit experience, employees are more likely to understand the value. Communicate that voluntary benefits can be an integral part of a “total rewards package.” — Peter Marcia, YouDecide

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Let’s stop taking Life for granted

We tend to treat group term life insurance as a commodity, focusing on price instead of employee needs.

February 14, 2019 | By Marty Traynor – BenefitsPro

Group life insurance is one of the most common benefits offered by employers. When asked about the importance of benefits in a 2018 LIMRA study, employees rated life insurance only behind medical benefits, paid vacation and retirement plans. In the same study, a survey of employers indicated they think employees rank life insurance lower than they do. Perhaps these employers are taking life for granted.

Group life insurance doesn’t come across as a very exciting product, partly because it’s so familiar to employers and employees. Employers know employees want to provide financial security to loved ones. Basic group life insurance provides sufficient money to cover basic final expenses. Providing for dependents’ future financial security expands the need and amplifies the amount of necessary coverage. That’s where term and permanent voluntary life insurance provides a great solution.

It seems unlikely that group life is being overlooked, but let’s look at the facts:

• In a recent LIMRA study, 17 percent of employers indicated they plan to drop group life insurance as a benefit. The overall number offering group life insurance was down 14 percent between 2006 and the 2018 study.

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Voluntary Benefits: Getting the Most Out of Tech

‘A major appeal of voluntary benefits is the increased sophistication of #HRTech that can be used for payroll contributions, communications and enrollments.’ -Peter Marcia, @YouDecideCEO #HR

January 29, 2019 | By YouDecide CEO Peter Marcia – for The HCM Technology Report

Most benefits managers in the industry are exhaling a collective sigh of relief now that open enrollment is complete and the first deductions with the new benefit amounts have been applied without a hitch (we hope).

Now, ready or not, it’s time to start thinking about 2020 open enrollment. Escalating healthcare costs and increasing insurance gaps will again catapult voluntary benefits to the forefront.

Voluntary benefits help complement a total rewards plan and fill essential gaps caused by cuts in traditional benefit programs. As with core medical programs, employers can get better underwriting, pricing and plan designs than what an employee would typically find on the individual market. A major appeal of voluntary benefits is the increased sophistication of technology that can be used for payroll contributions, communications and enrollments.

During the 2019 open enrollment cycle, employers used technology in new ways to administer and communicate their voluntary benefits. We expect the “shift toward voluntary benefit delivery” to accelerate as carrier partners upgrade technology platforms, product portfolios, underwriting models, and communications methods to meet the needs of employers.

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Why voluntary benefits are good for employers

Products like accident insurance may help your clients get, and keep, the best workers.

January 8, 2019 | By Andy Glaub – BenefitsPro

Following eight years of job growth, the U.S. unemployment rate hit a nearly five-decade low in September, according to a recent U.S. Department of Labor jobs report. While this is good news for the U.S. economy, it suggests there is a smaller pool of active job-seekers and a high demand for workers.

As a result, companies are facing fierce competition when it comes to winning over new talent. While some companies are raising wages to woo job candidates, many companies cannot afford to do so. However, boosting benefits is another effective strategy for not only winning new talent, but keeping talent around. In fact, 55 percent of the 2,000 employees surveyed for the 2018 Aflac WorkForces Report said they would be at least somewhat likely to accept a job offer with slightly lower compensation but better benefits options. Additionally, more than one-third of employees said an improved benefits package would help keep them in their current job.

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Short-Term Health Plans Highly Profitable for Brokers and Insurers

December 21, 2018 | By Julie Appleby – Kaiser Health News

Sure, they’re less expensive for consumers, but short-term health policies have another side: They’re highly profitable for insurers and offer hefty sales commissions.

Driven by rising premiums for Affordable Care Act plans, interest in short-term insurance is growing, boosted by Trump administration actions to ease Obama-era restrictions and possibly make federal subsidies available to consumers to purchase them.

That’s good news for brokers, who often see commissions on such policies hit 20 percent or more.

On a policy costing $200 a month, for example, that could translate to a $40 payment each month. By contrast, ACA plan commissions, which are often flat dollar amounts rather than a percentage of premium, can range from zero to $20 per enrollee per month.

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