In addition to providing basic disability protection, many of todays DI buy-out products offer new features that can benefit the client. Here are some product features that you should consider when examining which product youll recommend to your clients. In essence, they can help improve the ease of the sale, which is why its important to ask:

Is there a lump sum benefit? Some carriers in the DI market today are offering up to a $1 million lump sum benefit in as little as a 365-day elimination period. Other carriers wont take this kind of risk, so make sure to ask the manufacturer.

What is the maximum benefit amount? Historically, some carriers have had a $1.5 million limit on their payouts. Today, on installment payout methods, carriers have, in some cases, offered up to $2.5 million in benefits amounts. Find out what the benefit amount is for the product youre considering.

Is there a coordination of benefits feature? Through the coordination of benefits feature, some DI carriers will overlay existing DI buy-sell coverage offered by another carrier as long as overall maximums have not been reached.

–Bob Dehais


Reproduced from National Underwriter Life & Health/Financial Services Edition, January 2, 2004. Copyright 2004 by The National Underwriter Company in the serial publication. All rights reserved.Copyright in this article as an independent work may be held by the author.