Joe Russo

The most important and fundamental of critical assets to the continuation and financial success of any American business of any size is not in its fiduciary holdings and intellectual properties, nor is it in the more readily tangible equities like manufactured product, real estate, office equipment and machinery. Arguably, a company’s most important assets are the actual men and women upon which the bottom line depends every day to make all of the many pieces fit and the wheels to continue to turn. Those that actually drive the business, the leaders, the rainmakers, they are the key persons of significant consequence.

Key persons may be business owners or even employees that play special and specific roles with immediate influence on corporate prosperity and balance. They are the rainmakers and the decision makers.

In the realm of corporate America, the term “rainmaker” holds substantial clout, influence and respect. Defined as “a person who generates income for a business or organization by brokering deals or attracting clients or funds,” a rainmaker is a key employee or key business owner, usually a go-getter, who is mainly responsible for a firm’s incoming new business and the retention of major accounts. They are integral to the present and future of organizations built upon foundations of strong outside relationships and growth of corporate accounts.

The digital world of networking, social media influencing and global business evolution and development has made the pivotal role of the corporate rainmaker that of an art form that is coveted by companies seeking growth and prosperity. Key personnel are typically heavily relied upon with regards to matters of sales and marketing. No longer are traditional methodologies of advertising and word-of-mouth referral enough to earn, manage and retain primary business contracts and the resulting inflow of business income related to such important clientele.

As insurance professionals we must dutifully contemplate and analyze the risk and potential corporate financial loss associated with the demise of a key person.

That being substantiated and widely accepted among most industries especially those of law, medicine and high finance, the physical loss of such an asset like a key person, a rainmaker with their expertise and their connections, can prove utterly disastrous and possibly fatal to any firm in the short and long runs. A loss of such personnel not only immediately affects corporate profitability, but also productivity, customer relations, employee morale and, in general, overall business effectiveness and efficiency.

The unexpected death of a key person is an obvious peril that requires attention and financial safeguards that can be addressed with the many available term or permanent forms of life insurance vehicles. But what about the occurrence of a serious, unforeseen event that results in not the death of a key person, but the physical incapacitation of such an important individual?

Now please allow me to digress momentarily and pose to you a simple, straightforward question with the intent of you placing emotion aside. What would happen to your business specifically if you became disabled from an accident or illness, and you were unable to work for a period of time or even at all ever again? Now I want you to really try to give this some sincere, unbiased thought, and imagine the horrific consequences from a business perspective.

If you are an independent agent, advisor or an agency owner, the probable answer is that you would have to attempt to sell your book of business quickly or let your staff go and close-up shop to keep from hemorrhaging capital. If you are an employee of a larger outfit, your inability to personally manage your accounts could cause great financial detriment, mostly in the short term, to those who employ you. Take a moment to realize that your clients, no matter their industry and line of work, likely face similar if not the same potential predicaments. What happens when a business’ key person becomes disabled? The simple answer is that the business suffers to the point of economic devastation.

The physical loss of a key employee or employer will most likely lead to the loss of present and future business accounts, the loss of relationships with crucial contacts, not to mention the office workflow issues that would inevitably arise. Furthermore, corporate capital and savings could have to be allocated to finding a suitable replacement employee who would then need to be trained and paid an appropriate salary. The actual costs of the loss of a key person due to disability can easily put a company into significant chaos both operationally and fiscally.

Insurance becomes essential in the preservation of such an important corporate presence, providing fiduciary safeguards in case of the tragic loss of a key person. As previously mentioned, life insurance is an important option and typically the first choice of advisors and company management. But as critical, if not more, to business financial and succession planning is disability insurance. Common statistics dictate that a key employee is at least three times more likely to become disabled during a working career than perish during that same time period. Financial indemnification of the unexpected loss of key personnel to disablement must be paramount.

Key person disability insurance can be acquired in most states either through a few domestic DI carriers or more commonly through the surplus lines specialty insurance markets like Lloyd’s of London. The product provides protection against the loss of cash flow and the typical increase in operation costs associated with the short and long term disablement of persons key to business operations.

Key person DI benefits may be used at the discretion of the employer or management with common applications of benefits for covering recruiter expenses to find temporary or permanent personnel replacements as well as reimbursing losses due to reduced productivity of failing or failed accounts. Benefits are also used to provide travel expenses for new account managers who attempt to keep marquee clients on the books as well as supplementing overtime payments for existing staff who are temporarily covering the inevitable additional workload.

Product benefit platforms offer various payment options and structures including scheduled monthly benefits typically up to 24 months after a waiting period usually less than six months, or large lump-sum cash payouts after a longer wait, or a combination of both, depending on the economic needs and liabilities of the corporate policy owner.

Although it is difficult to succinctly place a completely accurate dollar amount on the overall value of an influential figure, key person disability insurance is the most flexible, robust and appropriate tool in a business financial planning portfolio, providing generous and much-needed cash flows to firms reeling from the loss of critical personnel. Key person DI is essential in minimizing business risks and ultimately in facilitating business continuity.

Millennials outnumber Baby Boomers in the United States by more than eight million and represent more than a quarter of the American population. We also must turn some of our attention to the Gen Z demographic who are just in recent years entering the workforce. We are now faced with an intriguing dichotomy. Our greatest sources of prospective clientele now fall upon the youth and those nearing retirement–opposite ends of the spectrum. As an industry, specifically in the life and disability insurance markets, we must cater to both of those demographics if our businesses are to prosper. But how do we focus on groupings of persons who seem to be so different, including their values, ideologies and lifestyles? As insurance purveyors, we must wear different hats at different times. We must be flexible and embrace sometimes contradictory marketing methodologies.

Baby Boomers represent the politically and socially radical past of this country, but they have over time moved into a new era in life. They have well-established family dynamics, including grown-up children and grandchildren. They have become more conservative over the years, and while many of your older clients may have embraced much of today’s incredible technologies, marketing preferences generally remain antiquated among matured audiences. They remain preferential to print advertising and get their news outside of social media platforms, and they respond better to direct-contact marketing and face-to-face sales techniques than other demographics. A Boomer is a true salesperson’s prospect. They are self-aware of their age, their limitations and their need for financial protection insurances. Their way of thinking is more analytical and deliberate but can also be very stubborn.

As Americans are living longer and working longer than ever before, millions of Boomers are continuing to hold employment well into their sixties and seventies. There is a true fear of retirement as Boomers ponder their own savings accumulations. Many have failed to sufficiently save for retirement and cannot rely on social security or other government-sponsored benefits to provide for them and their spouses as they age.

Persons of older age need to insure their incomes for as long as they can as much as their younger counterparts do. And as a workforce nears the matured end of the spectrum, disability insurance becomes imperative.

Unlike in past decades, the U.S. disability market does seem to be taking the aging of a substantial section of the workforce into account, liberalizing participation limits and age restrictions like never before. Traditional DI carriers are frequently providing monthly disability benefits to age 67 and sometimes to age 70. Some traditional disability companies are issuing new income protection policies to men and women over the age of 60 which was uncommon 10 years ago. These are great strides the industry has made to keep up with contemporary economics and current demand. But it is not enough.

Since the onset of the COVID era, the carriers offering benefits to near-retirement clients are keeping their distance from the deep end of the risk pool. Their participation limits and benefit levels remain timid for older age income earners. They also maintain strict occupation class restrictions on aged clientele, especially those with any sort of adverse health history.

Specialty DI markets like Lloyd’s of London offer more comprehensive financial planning for persons nearing retirement. Those markets have the unique ability to provide long and short-term “own occupation” disability benefits to clients in their sixties and even seventies. Plans are also flexible enough to cater to those with health concerns.

For the aging workforce of the U.S., financial planning can go hand in hand with retirement planning. Prudent advisors will coach their clients into sufficient income protection no matter where they fall on the age spectrum. Retirement planning for Baby Boomers as well as Millennials begins and ends with income protection.

Americans deeply fear outliving their money in retirement. Yet, these concerns don’t always lead to subsequent real-life accountability since most people of working age aren’t making substantial progress toward increasing personal savings. The detrimental cycle continues. We worry about having enough retirement income and savings to live out our “golden years” in comfort, but we hardly take the steps necessary to achieve sufficient capital accumulation for use later in life.

Social Security is hardly the answer. The funds are relatively miniscule to those with average to affluent lifestyles, and with many Boomers having reached historical retirement age, projections show that the outtake of benefits may soon outgrow the intake of taxes. Social Security reservoirs are dwindling. Saving must take place proactively before retirement, while a person is still a producer and an earner.

401(k), IRA and similar plans are attractive to consumers and another step in the right direction. Those with access to employer-sponsored retirement savings programs are gaining more understanding and more trust in placing higher levels of income into retirement accounts, and with more employers matching or adding contributions, these accounts have become among the strongest wealth savings vehicles available to employed Americans.

However, considering recent volatility, we can’t completely count on market performance of retirement accounts or other personal investments. More importantly, we can’t guarantee that regular payments will continue to sufficiently build those coveted retirement funds. What would your client do if he/she were to suffer an illness or injury that resulted in long-term disablement? What would eventually happen to your client’s income? Who would continue making contributions to your client’s retirement savings? If your client became disabled, eventually he/she would no longer be able to work nor receive an income. Any total debilitation would result in your client struggling to financially survive today as well as into traditional retirement years.

Disability income insurance is one of the greatest retirement planning tools. Without the protection of a comprehensive disability insurance package, clients of any age stand to lose their ability to effectively accumulate wealth and savings for use in the later years of life. Over the last several decades, life expectancy has increased in the United States, creating a greater need for proper savings safeguards like disability insurance, not only for retiring Boomers, but for those with a long career ahead.

Millennials as well as the fledgling Gen Z are a completely different breed from the Boomer generation when it comes to successful disability insurance marketing. They generally believe they are physically impervious to accidents and sickness. Furthermore, they were born with smartphones in their hands and computers at their fingertips. They are impatient and think they know everything, or at the very least they think they can do everything better than previous generations. And they are probably correct. They can certainly obtain information faster than ever before, and they are intelligent; more young Americans have college educations than ever before. But most importantly, Millennials understand how to use and leverage technology better than their forefathers which makes them adept in employing social media and other electronic resources to communicate, find their news, do their shopping and research and purchase their insurance policies. They have grown-up with social media, and they trust and rely on electronic forms of commerce and communication.

So, there is the dilemma. We are faced with completely different demographics of prospective clients, all of which are well worth the trouble of going after. Are your current marketing strategies going to afford you the opportunity of targeting both the young and those nearing retirement? You must adapt. Remain a true insurance salesperson, but do so on multiple levels, in multiple mediums to multiple audiences.

That is the reality. We must continue to diversify our marketing and sales techniques to reach all available markets. Like most other financial industries, the future of this business will inevitably be primarily focused on technology, ease, speed and efficiency of policy issuance and delivery.

Millennials and Gen Z certainly represent the present and future of the U.S. economy, and they have changed the way much of the world conducts business. To achieve success in this industry, we must embrace and indulge in the preferences of both the young and the old. These continue to be intriguing and challenging times from an advisor’s perspective, but the future holds endless opportunities if you are respectful to diverse marketplaces, are able to learn new tricks and are willing to adapt.

The most important and fundamental of critical assets to the continuation and financial success of any American business of any size is not in its fiduciary holdings and intellectual properties, nor is it in the more readily tangible equities like manufactured product, real estate, office equipment and machinery. Arguably, a company’s most important assets are the actual men and women upon which the bottom line depends every day to make all of the many pieces fit and the wheels to continue to turn. Those that actually drive the business, the leaders, the rainmakers, they are the key persons of significant consequence.

Key persons may be business owners or even employees that play special and specific roles with immediate influence on corporate prosperity and balance. They are the rainmakers and the decision makers.

In the realm of corporate America, the term “rainmaker” holds substantial clout, influence and respect. Defined as “a person who generates income for a business or organization by brokering deals or attracting clients or funds,” a rainmaker is a key employee or key business owner, usually a go-getter, who is mainly responsible for a firm’s incoming new business and the retention of major accounts. They are integral to the present and future of organizations built upon foundations of strong outside relationships and growth of corporate accounts.

The digital world of networking, social media influencing and global business evolution and development has made the pivotal role of the corporate rainmaker that of an art form that is coveted by companies seeking growth and prosperity. Key personnel are typically heavily relied upon with regards to matters of sales and marketing. No longer are traditional methodologies of advertising and word-of-mouth referral enough to earn, manage and retain primary business contracts and the resulting inflow of business income related to such important clientele.

As insurance professionals we must dutifully contemplate and analyze the risk and potential corporate financial loss associated with the demise of a key person.

That being substantiated and widely accepted among most industries especially those of law, medicine and high finance, the physical loss of such an asset like a key person, a rainmaker with their expertise and their connections, can prove utterly disastrous and possibly fatal to any firm in the short and long runs. A loss of such personnel not only immediately affects corporate profitability, but also productivity, customer relations, employee morale and, in general, overall business effectiveness and efficiency.

The unexpected death of a key person is an obvious peril that requires attention and financial safeguards that can be addressed with the many available term or permanent forms of life insurance vehicles. But what about the occurrence of a serious, unforeseen event that results in not the death of a key person, but the physical incapacitation of such an important individual?

Now please allow me to digress momentarily and pose to you a simple, straightforward question with the intent of you placing emotion aside. What would happen to your business specifically if you became disabled from an accident or illness, and you were unable to work for a period of time or even at all ever again? Now I want you to really try to give this some sincere, unbiased thought, and imagine the horrific consequences from a business perspective.

If you are an independent agent, advisor or an agency owner, the probable answer is that you would have to attempt to sell your book of business quickly or let your staff go and close-up shop to keep from hemorrhaging capital. If you are an employee of a larger outfit, your inability to personally manage your accounts could cause great financial detriment, mostly in the short term, to those who employ you. Take a moment to realize that your clients, no matter their industry and line of work, likely face similar if not the same potential predicaments. What happens when a business’ key person becomes disabled? The simple answer is that the business suffers to the point of economic devastation.

The physical loss of a key employee or employer will most likely lead to the loss of present and future business accounts, the loss of relationships with crucial contacts, not to mention the office workflow issues that would inevitably arise. Furthermore, corporate capital and savings could have to be allocated to finding a suitable replacement employee who would then need to be trained and paid an appropriate salary. The actual costs of the loss of a key person due to disability can easily put a company into significant chaos both operationally and fiscally.

Insurance becomes essential in the preservation of such an important corporate presence, providing fiduciary safeguards in case of the tragic loss of a key person. As previously mentioned, life insurance is an important option and typically the first choice of advisors and company management. But as critical, if not more, to business financial and succession planning is disability insurance. Common statistics dictate that a key employee is at least three times more likely to become disabled during a working career than perish during that same time period. Financial indemnification of the unexpected loss of key personnel to disablement must be paramount.

Key person disability insurance can be acquired in most states either through a few domestic DI carriers or more commonly through the surplus lines specialty insurance markets like Lloyd’s of London. The product provides protection against the loss of cash flow and the typical increase in operation costs associated with the short and long term disablement of persons key to business operations.

Key person DI benefits may be used at the discretion of the employer or management with common applications of benefits for covering recruiter expenses to find temporary or permanent personnel replacements as well as reimbursing losses due to reduced productivity of failing or failed accounts. Benefits are also used to provide travel expenses for new account managers who attempt to keep marquee clients on the books as well as supplementing overtime payments for existing staff who are temporarily covering the inevitable additional workload.

Product benefit platforms offer various payment options and structures including scheduled monthly benefits typically up to 24 months after a waiting period usually less than six months, or large lump-sum cash payouts after a longer wait, or a combination of both, depending on the economic needs and liabilities of the corporate policy owner.

Although it is difficult to succinctly place a completely accurate dollar amount on the overall value of an influential figure, key person disability insurance is the most flexible, robust and appropriate tool in a business financial planning portfolio, providing generous and much-needed cash flows to firms reeling from the loss of critical personnel. Key person DI is essential in minimizing business risks and ultimately in facilitating business continuity.

The common definition of a high-net-worth individual (HNWI) among economists, bankers and financiers is someone with liquid or investable assets of at least $1,000,000. That certainly doesn’t encompass most Americans, but unrecognized by many in the financial services industry, it does include a broad swath of prospective clientele, everyday searching for additional financial protection options and more-well-rounded, balanced insurance portfolios.

In my opinion, the usual HNWI definition is in itself misleading and quite limiting. It can be a turn-off to brokers and advisors spending most of their time marketing outside that space. “I work in the middle markets, my clients don’t make that kind of income” or “I work with white-collar individuals, but these days they often don’t have liquid assets of that level” are common excuses. My advice is to resist being discouraged or turned away by definitions in a book or trade journal.

The HNWI definition needs broadening as it pertains to a very important facet of personal financial protection and that is disability insurance–now commonly referred to as income protection as well as the more evolved millennial label of “paycheck protection.” Disability insurance (DI) is arguably the greatest financial safeguard to any employed person, no matter compensation level, occupation, age or socioeconomic demographic. The traditional HNWI definition fails to address and fully represent those that fall into gray areas like persons with substantial annual earnings, but lacking historical holdings of liquid assets. As it pertains to disability insurance, the definition should be augmented to a more forgiving nature aimed less at liquidity and savings volume and directed more at annual income level.

My definition of a high-net-worth individual is an employed person making over $250,000 annually. Simple as that. We’re not only talking about professional athletes, hedge fund managers, Hollywood movers and shakers or CEO’s of Fortune 500 companies. I want to dispel those misconceptions. We are also talking about insuring accountants, physicians, attorneys and mid- to upper- level management employees that probably many of you know and work with already. HNWI are not necessarily “pie in the sky” prospects that you may think are out of your league. I’m talking about everyday working individuals with nice incomes that frequently need more insurance. Many HNWI clients are certainly within your business marketing striking distance.

The reasoning behind my “madness” and tangent from that traditional HNWI definition is that most Americans making over $250,000 a year cannot typically find sufficient disability resources solely amongst the ranks of domestic disability insurers. The prescription of a traditional group disability policy and/or a comprehensive individual income protection policy from one or more domestic carriers rarely satisfies the entire need of someone at higher earnings levels. Income participation limits for domestic carriers commonly land in the 40 to 60 percent of income range for a HNWI. Those breakpoints are unacceptable to most economists and disability income specialists, and it should be unacceptable to your HNWI clients.

To maintain family expenses and comfortable lifestyles, every working American needs at least 65 to 75 percent (dependent upon benefit taxability) of his/her income covered by DI. And just because an affluent person might have more of a nest egg and savings to fall back on in case of an unforeseen disablement and inevitable loss of income, that doesn’t mean they have less to lose. They have more to lose, which is why the dutiful insurance advisor’s attention should eventually turn to foreign specialty markets like Lloyd’s of London to fill in the financial protection gaps with excess, high-limit disability plans.

The ancient and historic Lloyd’s marketplace has been pioneering personal insurance products for the HNWI space for almost a century, and they are the champion when it comes to supplemental disability insurance. Administered by U.S. underwriting and marketing firms, Lloyd’s programs, backed by insuring corporate syndicates, tend to be shorter term in nature when compared to domestic DI products, but allow for substantial additional “own occupation” income benefits demanded by the HNWI market, especially those underinsured by traditional carriers.

Benefit packages are frequently prescribed as a combination of monthly income payments after a short elimination period followed by a substantial lump sum benefit, coordinating with the insured person’s salary and underlying disability benefits. Various policy riders are available in the market including inflation adjustment and residual/partial disablement benefits. Interestingly, Lloyd’s has also developed a very important, but lesser known corporate stock option indemnity plan that is specific to the HNWI space.

Certainly in today’s global atmosphere, adverse economic, social and health concerns are at the forefront of everyone’s mind. The ongoing COVID-19 pandemic has negatively affected every country on this planet in one form or another. Many international high finance and insurance institutions have been forced to make corrections that trickle down to the consumer level.

COVID claims in the non-appearance, contingency, business interruption and event cancellation insurance spaces have had severe impacts on carriers the world over, and we are seeing a slight to moderate “hardening” of various life, health and accident markets on the home front as well as across the pond. Carriers are facing actuarial pressures to increase rates, shorten policy terms, strengthen policy wordings, fix possible wording loopholes and lessen benefit periods. Yet the demand for insurance solutions in the HNWI space continues to thrive as marketplace dynamics ebb and flow in response to the evolving pandemic concerns.

One field of the HNWI market that analysts and actuaries are keeping a close eye on is that of doctors and surgeons. Historically, medical professionals have been known to be prime income protection targets. They are learned and tend to value the critical nature of insuring one’s income as an integral asset. Yet in recent years, gargantuan benefit limits, specialty-specific definitions of disability and wildly popular guaranteed-issue, multi-life benefits platforms have prompted higher instances of long-term disability claims. The pandemic’s stifling effect on the profitability of private medical practices has further exacerbated the glaring claims problems.

On the other hand, the field of private equity is burgeoning. Despite volatility in global economies and fears of recession prompted by the pandemic, mergers and acquisitions among many corporate industries are rampant, and the need for raised capital continues to expand, resulting in higher incomes and additional insurance needs for those involved in private equity companies. They are the newest rock stars, and their lofty compensation schedules are demanding more participation from income protection carriers.

Another interesting facet of the HNWI market that always begs for attention is that of the collegiate and professional athlete space. Sports salaries and compensation packages continue to increase and set new bars, yet underwriters are facing pressures to address design flaws in certain disability products that have allowed for substantial and questionable claims histories. The sales of previously popular products like
“loss of value” insurance in both the college and pro arenas has been curtailed and policies redesigned by many market specialists to provide fairer claims thresholds

Beyond personal DI, business insurances are extremely relevant in the HNWI market. These individuals are frequently business owners and/or “rainmakers” that carry with them the extra burden of not only maintaining corporate profitability and their own financial successes, but the job sustainability of the persons whom they employ. High-limit disability products like key person insurance, business overhead expense coverage and buy/sell insurance are requisite income protection vehicles for prudent business and succession planning.

The HNWI market has fared relatively well during the COVID-19 era, and the need for high-limit income protection is more obvious now than ever. More Americans, lacking sufficient income protection, are fitting into the HNWI category. Fortunately, the combination of prescribing disability benefits from both domestic and foreign carrier resources in a tiered-benefit fashion is easily attainable.

Life in America has utterly changed in 2020. By now most of you are tired of hearing about the Coronavirus, for the topic of this ongoing pandemic has permeated and completely saturated all levels of media, including subjects on best agency practices along all lines of insurance. But the reality is that the impact of COVID-19 is deeply affecting the business landscapes and strategies of most insurance markets.

Insurance claims stemming from infection rates of the virus itself as well as anticipation and trepidation of the spread of the disease has for months rocked domestic and international marketplaces. We are seeing widespread hardening of the industry where fiduciary loss and overcompensating corporate adjustments have led to rising premium rates with fewer underwriting concessions among property, casualty, business and personal lines carriers.

The far-reaching global influence of the pandemic is already changing the practiced fundamentals and micro economics of local insurance scenes. Even the specialty markets of Europe are forecasting billions in losses from bespoke products like event cancellation, trip insurance and non-appearance cover. These remarkable Coronavirus claims combined with the usual anticipated losses associated with recurring natural disasters like Southeastern U.S. storms and Western U.S. wildfires are making 2020 an unfortunate year for the insurance record books.

But how can you mitigate the fiscal and socioeconomic panic of the world at a time like this in your own business practices? How may you best serve your clientele while maintaining a prosperous book of business all while cultivating reciprocal and profitable relationships with cautious insurance and reinsurance companies?

Remember you serve the consumer, and in these uncertain times it is paramount to protect your clients not only from financial disaster but also in terms of physical safety and health. We are in a health crisis, and the physical wellbeing of the populous is what is most important these days. That is why the lifestyles we were used to eight months ago have been so drastically altered. That is why many of us are working from home. That is why we wear masks to the grocery store and physically distance from the neighbors we have known for years. Life has changed…maybe just for the present, but it is definitely not the same as it was eight months ago. Business practices are being quickly forced to evolve for the safety and comfort of our clients.

It became abundantly apparent in March of this year, at the point of the widespread “stay at home” orders coming down from state governments, that the pandemic had lessened comfort levels in consumer appetites regarding the prospects of purchasing life, health and disability insurance products. Immediately, inquiries about guaranteed-issue policies and simplified underwriting garnered more credence than historically more important trends like price, product terms and policy wording definitions.

Clients were scared. No one wanted a stranger in their home to perform paramedical examinations taking blood and urine samples. Our homes have become familial bubbles–fortresses and safeguards against the virus. In the past, insurance exams and labs were necessary inconveniences and part of the cost of attaining financial protection–a modest intrusion to allow risk assessment, providing underwriter familiarity for the decision making process of insurance companies. The original intent of the home or workplace examination was to provide a very convenient service to the customer. However, in the COVID-19 era, the practice has become detrimental to normal insurance operations and to the psyche of the consumer.

Consumers are still scared of Coronavirus, and it is in your best interest as an insurance professional and advisor to keep your clients safe in this erratic environment. Maximize client comfort by leveraging recent business practice concessions of insurers and wholesale underwriting firms.

For the past six months, life and health carriers of both the domestic and the specialty markets have scrambled to develop underwriting protocols that allow for greater consumer safety and peace of mind without hindering the underlying integrity of insurance carrier due diligence and risk analysis. Methodologies haven’t changed, but at times there is greater underwriter flexibility, and the grand journeys to those ultimate decisions do look surprisingly different.

Carriers are more frequently employing simplified-issue platforms on coverage with stricter benefit and term limitations. Company management are also allowing underwriters to put greater stock into client phone interviews as well as primary care and specialist physician medical files. Some life and disability companies are allowing prospective clients to submit previous physical exams and laboratory results for current underwriting purposes as long as the tests were performed within the previous six to twelve months.

Most markets are not wanting to see their business significantly falter, and they are willing to accommodate insecure prospects as much as their evolving, more-lenient business strategies will allow. Specialty-market carriers like Lloyd’s of London are more frequently providing their disability clients nervous about face-to-face physical examinations with numerous product and underwriting alternatives. For example, recent offerings include “accident only” disability cover without medical tests with an option to upgrade the cover to full “accident and sickness” at a later date once exams and labs are convenient.

Life carriers have certainly been a mixed bag. Instances of coverage postponements and declinations for impaired risks and older clientele seem to have skyrocketed, but carriers are also allowing for more client accommodation of standard risks with simplified-issue, non-contact underwriting. Consumers are able to acquire personal term life benefits from some traditional carriers without physicals, yet subject to limitations on term length and benefit amount.

The specialty life markets have really championed zero-contact underwriting with the promotion of key person critical asset and contract protection insurances for business prospects needing timely issued high-limit death benefits. Specialty underwriters have come to employ short-form applications of nothing more than a standard questionnaire and abbreviated health summary and no requirements of exams, labs or medical files. Furthermore, impaired risk cases are still widely considered by specialty-market carriers.
Automation has also become quite important. Insurance marketers have continued to move away from clumsy applications and supplemental questionnaires in favor of streamlined electronic application platforms and paperless policy delivery. From a technological standpoint, insurance companies are making the acquisition of financial protection policies easier, safer and more comfortable for the consumer in the COVID-19 era.

Although this pandemic has created disastrous results for many industries across this country, it has forced insurance carriers to rethink their procedures and underwriting methods which, for the most part, should be pleasant news to you and your clients. In many respects insurance companies are attempting to be proactive and allow for flexibility never before seen in the industry. It is up to you to leverage these circumstances, protecting the medical and financial well being of your clientele. A comfortable, healthy client is a happy client, and that is just good business.