Underwriting Disability Insurance
Underwriting Doesn’t Have to Be Scary
Nobody loves the word “underwriting.” So often this word is associated with the mountains of paperwork necessary to buying a home, taking out a loan at a bank or having your overall health looked at by an insurance company. But, here at Policy Wizards, our goal is to be “The Easy Way to Protect Your Greatest Assets.” With years of industry experience, we have access to the most favorable underwriting programs across the insurance sector, simplifying the process and minimizing your risk of receiving an adverse underwriting opinion.
What is Underwriting?
Simply put, Underwriting is the process that an insurance carriers uses to determine how it’s policies are issued and how much they will charge each individual customer.
Disability Insurance Underwriting
For disability insurance, the insurance company will look at a person’s age, gender, occupation, job duties, income, health, etc., to arrive at a risk classification for that individual. This process can vary greatly by product, carrier and their desired coverage. The underwriting guidelines of the company and the risk analysis of the underwriter (the person employed by the insurance company who applies those guidelines to each application), is what will ultimately decide if you’ll be offered a policy, and if so, what it will cover and how much it will cost.
At Policy Wizards, we represent you, not the insurance company. We will have a confidential consultation with you in order to help you decide which carrier is the best fit for your overall health and budget; ensuring you can protect your greatest assets, without breaking the bank.
For most people, underwriting is the only way to obtain a disability insurance policy. For disability insurance, underwriting is going to be comprised of three key components:
Health, the most important factor in underwriting. Every insurance carrier will collect some form of health information through a questionnaire, including questions about your lifestyle, nicotine usage, and a handful of other health related questions. Depending on the amount of coverage being applied for, a medical exam may also be necessary. This could be anything from a urinalysis, to a full blood profile that includes physical measurements and some other basic diagnostic tests. The examiner will often complete these tests at your home or can also come to your place of employment.
Depending on your overall health, answers to the medical supplement, and recent doctors’ visits, the insurance company might also request an Attending Physician Statement (APS) which contains your recent doctors records. Your Policy Wizard can be an asset through this process, working closely with the insurance comapny to minimize and expedite the underwriting process, and may even be able to help you avoid the medical exam and APS processes.
Unlike most traditionally underwritten life insurance policies, fully underwritten disability insurance may sometimes require proof of your income in order to be approved for the benefit amount requested. Since disability insurance is income replacement, the insurance company will not provide income replacement for an amount above what you are currently making. Financial underwriting may also vary depending on whether you have a W-2 income or are a business owner. Other documents, such as any existing disability coverage you may have through your employer may also need to be provided during the underwriting process.
Depending on the amount of coverage you’d like to apply for, your Policy Wizard will have access to different programs that allow both professionals and business owners to get the coverage you need without the hassle of obtaining financials. Should you end up needing to sumbit your financial information, your Policy Wizard will be able to guide you through every step of that process, and avoid the pitfalls that can delay securing your policy.
Insurance companies assign each job with an occupation class. This is the hazards and liklihood of injuries associated with the duties that you perform. The occupation class assigned to you will have a major effect on your premiums and benefit period. Occupations that tend to have more disability claims than others are considered high risk, and those policies will be priced accordingly.
Your Policy Wizard will work with the major carriers to provide you the best protection at the best occupation class available to you, ultimately providing you with the best coverage at the lowest rate.