It’s sort of a simple concept really, and here’s the basic idea. If you are applying for health insurance – whether as an individual or as a company - you will be gathering together your medical history and hunting down the contact information for your medical providers anyway – so why not check on your other health related coverages at the same time?
Primarily that means looking at individual disability insurance and/or individual life insurance policies. At McCarthy Stevenot Agency, Inc., we have access to providers for both of these types of insurance. With life insurance especially, it is very easy to get basic quotes from several insurance carriers. While there are still some circumstances that favor permanent types of life insurance coverage, the majority of what we see purchased today are term life policies. Usually we see people looking at level term plans with a 10-year, 15-year or a 20-year level premium periods.
One difference you can encounter when looking into life insurance on an individual basis (versus most health insurance applications) is the likelihood of having to take at least a basic paramedical exam. We once looked policies known as “simplified issue” policies for our clients so that groups might access coverage without a required paramedical exam. The problem with simplified issue policies is that they aren’t worth the convenience from a cost standpoint. Many people who could have easily qualified for a fully underwritten life policy may end up paying two to three times as much for a similar simplified issue policy. In the end, not a very good trade off just to skip the inconvenience of a paramedical exam.
Important Note for Groups
If you represent an employer group or company plan and you would like to see individual rates for employees, it is possible to do so. If you use a “group” term life plan (versus the individual type plans we have been discussing) as a base (generally a good idea – though still somewhat costly by comparison), group term life policies are usually simplified issue and are typically not transportable if an employee leaves his or her job. However, individual life policies can me billed at home, are competitive and are fully portable. Underwriting will be based on each individual employee. Some employees may qualify for individual policies and some may not. Those who do qualify, will (as mentioned above) be able to do so at more favorable rates.
The last point to mention on this subject is the anticipated trend in life insurance rates. For years life insurance rates trended downward as life expectancies rose and investment returns were in the black. While health care quality remains on a general upswing, investment returns for life insurers have shown some easing of late. Many insurers find themselves with a significant portion of their assets not only invested in compressed stock market securities, but also in value-compressed mortgages and commercial real estate. The downward pressure from these investments is expected to have a negative affect on rates and policy fees in the near term. Therefore, it is agruable, if rates continue to rise, that now may be good time to take a look at individual policies before rates escalate further.
If you would like more information on individual disability insurance or life insurance quotes for you or for the employees in your group, please contact our office at 513-891-9888.