The program
Worksite insurance is a great opportunity for you to bring professional insurance services to your employees through your workplace. This program is completely voluntary; your employees decide whether or not to participate. Employees pay premiums through automatic payroll deduction, which simplifies the payment process.
Products
Disability Income (DI)
Rates are unisex and nonsmoker/smoker distinct.
Optional benefit rider
• On-the-job Accident Rider
– Modifies the base policy to provide 100 percent of the monthly disability benefit from an on-the-job accident
– Pays 50 percent of the monthly benefit if the insured is receiving workers’ compensation or state disability income benefits
The risk of becoming disabled is greater than your employees may realize
• Studies show that a 20-year-old worker has a one-in-four chance of becoming disabled before reaching age 67. (Social Security Administration, 2015)
• At age 30, long-term disability is four times more likely than death for men and seven times more likely for women. (The National Underwriter 2015 Field Guide)
Disability can cause financial hardship
Disability causes nearly 50 percent of all mortgage foreclosures; only two percent are caused by death.
Worksite Disability Income insurance benefits can help in the event of unexpected loss of income due to a disabling sickness or injury. The average long-term disability absence lasts 2.5 years. (Commissioner’s Individual Disability, Table A)
Determining eligibility
Industry eligibility (most employer groups are eligible, provided they are not listed as not eligible in the Industry Guide)
• Company must be in business for at least 24 months
• Company is not subject to significant seasonal fluctuations in personnel
• Personnel turnover rate is under 25 percent
• Personnel is composed of fewer than 50 percent family members
Occupational eligibility
• Must be working a minimum of 25 regularly scheduled hours per week
• Must be working a year-round schedule
• Must be employed for at least 90 days prior to enrollment (see Industry Guide in your agent guide for eligibility)
Financial eligibility
• Minimum income is $8,000 per year
• Maximum monthly benefit is 60 percent of covered earnings, up to $3,000
• Covered earnings are defined as the employee’s regular monthly salary, not including any overtime pay, bonuses or other compensation
• Income from other jobs is not included, even if it is the same occupation
Other coverage
• Existing individually owned disability insurance coverage or employer-sponsored disability coverage is taken into consideration as an offset in determining the amount of disability coverage for which the employee is eligible
• Disability Income/Waiver of Premium Rider on an individual life policy is taken into consideration as an offset
List bill
• Minimum of five participating employees required for list billing
• Individual LifeHorizons products can be issued with full underwriting and included on the list bill
Underwriting requirements
Simplified issue underwriting
• Available on pre-approved employer groups of five or more eligible employees
• Participation requirements
– Groups of 5-59 require a minimum of five applications
– Groups of 60 or more require a minimum of 10 percent participation
Contingent guaranteed issue underwriting
• Available on pre-approved groups of 50 or more eligible employees
• Participation requirements
– Groups of 50-99 require a minimum of 20 applications
– Groups of 100 or more require a minimum of 20 percent participation
• If participation requirements are not met, case is considered simplified issue underwriting
• If any questions in the Contingent Guaranteed Issue section of the application are answered “Yes,” simplified issue underwriting will apply
Application process
• Complete entire application
– Provide details to any questions answered “Yes” in the Contingent Guaranteed Issue and Simplified Issue sections
Re-enrollment
• 90 days prior to re-enrollment, the agent and life field marketing representative each receive a reminder and in-force policyholder report
• If initial enrollment qualified for Contingent Guaranteed Issue underwriting, employees hired since the last enrollment are eligible for Guaranteed Issue subject to answers provided for questions in the Contingent Guaranteed Issue section
