You Don’t Have to Let it Malinger! Let’s Get Into LTD! – S1 E7

Join Daryl Oliver and Dominic as they dive into all things Disability. Daryl is an OG in the disability business, our OneAmerica rep and the hardest working man in employee benefits. He has years of experience working with disability and he has some interesting ways to rethink the tried and true “60% to $6,000 to SSNRA” that we all somewhat complacently quote. The idea here is there are simple changes we can make in quoting that make an impact on the package.

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This transcript has been auto-generated and has not been checked, proofread, or corrected.

Hello everybody. It’s Dominic Siciliano. Welcome to season one, episode lucky seven of the what’s the benefit podcast. It’s uh, I just said it’s Dominic Siciliano, but there I am again. Today, we interview Daryl Oliver from One America. Many of you in the audience know Daryl. He is a veteran of our industry.

He’s been in Michigan and as a carrier rep for a long time. He’s got a wealth of knowledge and he’s actually somebody I really admire. Uh, the reason I brought him on is he’s done some trainings with my staff and with other insurance agencies with me. Just based on his experience, he has some underwriting experience.

He has. Sales experience in life and disability, many years, 20 plus years of experience in that space. But what Daryl does is, uh, even though his job is to represent his carrier, One America, which he does do that, but ultimately on in this episode, we talk, we dig into.  Going past the 60 percent to six grand paradigm, going past the zero, seven, 13 paradigm.

What I mean by that is in our business, I think we get pretty complacent. In other words, we just kind of say match benefits, match benefits, match benefits. And one of my passions, and I think I’m a kindred spirit to Daryl in this way is If you have a need or you want to review an audience or an employee population or a client, or you’re prospecting a client, we love to dissect these contracts and say, Hey, you know, in this population, you have a very full female population. 

definitely in childbearing years. Let’s design the short term disability to ensure that those people have the proper access to claims. Maybe we’ll do a first first day hospitalization benefit, et cetera. Or if we’re in a different population, is this, do we absolutely need to go to sort of, to do that? to a, to age 67 for a LTD benefit.

Today, we’re going to discuss those things. We’re going to tell you why, why going off the 60 percent to 6, 000 isn’t always a bad idea, and you can actually win business or make an employee package, a benefit package, a little bit more, um, um, a little bit more defined in. And designed around the population you serve.

So, um, one other thing about Daryl is somebody I’ve known a long time and we didn’t, we were competitors for a long time. He worked at Dearborn for the majority of the time I’ve been at Benefit Profiles and he just recently joined One America about three years ago. We’ve worked with One America for a while.

But what I admire about Daryl is his work ethic, he lives in Southeast Michigan, but his territory is West Michigan, he’s here every week, his ethics, he’s a good guy, and um, he’s just been a good partner. So, uh, I think you’ll really enjoy this conversation, especially if you’re an insurance dork like me, if you’re not, I still think you’ll enjoy it.

So, without further ado, welcome Daryl. Dominic, good morning! Thank you very much for having me this morning. Yes, it’s my pleasure. And I hope everybody out there listening is going to enjoy this. You know, you and I have known each other, gosh, a long time,  18 years, 19 years. Um, but do you mind giving the audience your background and we’ll talk about.

Uh, why you’re perfect to be doing this meeting today or to record this podcast about, about the ins and outs of disability and life insurance. Well, Dom, thank you. Absolutely. And, uh, very, very fortunate for our long term friendship and business relationship as well. I started 31 years ago with a carrier called CNA, uh, out of Chicago as an underwriter for group life and disability.

Uh, for the first four years. So that encompassed the home office in Chicago. And then I moved to Atlanta with CNA. Again, I, those fundamental skills of understanding life disability, the contracts, the, the rating mechanics of it. Um, you know, at the time it was very, uh, it was difficult wanting to get into sales and, you know, grinding it out at the desk every single day.

But as I look back, it was very invaluable to have that understanding and background of the mechanics of the products before I went out and actually educated agents and the sales process. So that was the first four years. And then I started my sales career in Charlotte, North Carolina, covering the Carolinas for a couple of years and had the great fortune to move back here to Michigan in 97 with CNA.

So that’s, you know, that was the first segment. And then I moved to, you know, for a period of time, uh, then to, uh, Dearborn and was very instrumental in partnering Dearborn with Blue Cross and Blue Shield of Michigan. Did that, uh, was at Dearborn for 13 years, close to 13 years, and then joined One America, which gave us the opportunity to work together.

Yeah. So that, uh, you know, I think that’s probably one of the best parts of components of moving on from, uh, from the prior carrier. And it’s been almost three years at One America, and it’s been a ton of fun, uh, giving agents a fresh new solution around, uh, group life, short term and long term disability from two lives up to several thousand.

You know, we had a relationship with One America. It was kind of fledgling, and then you joined. And One America for us has been, it’s been a great product because agents appreciate the personal service, and that really Really strong contracts. Where do you see why we’ve certainly had success, but where do you think we’ve found the most success?

It’s been a lot of relationship cause you’ve been in West Michigan a long time as well. But, uh, from your perspective, what do you see where agents kind of, uh, are attracted to one American BPI? Well, Dom, I mean, yeah, that’s a pretty broad question. You got an hour and I might have to take that all up in this one question.

But you know, your value props are enormous just in terms of your technology platform, your relationships in the market, the trust, the friendships you’ve developed over decades with the agent community, um, and your vast portfolio of offerings, right? Like OneAmerica is not going to be the right fit for every agent, for every a business for sure.

And then, you know, again, you having the worksite products and the dental and the medical component that One America does not. So it kind of rounds things out, but getting back to really the value props of why we’ve been successful. And again, very, very fortunate. And for those agents that are listening, want to say, thank you.

I would say most every carrier rep, one of their main goals is to get office the year. And we were able to accomplish that in 2023. And that’s, Yeah, I think that’s a big deal. That’s a testament to our relationship, Dom, our partnership at BPI, the agent community, trusting us and giving us the opportunities to perform, find those unique solutions in the market.

But I would say one of our best. Biggest value props is Katie Achinski, our account manager, uh, in that she works top to bottom down to a two life group. There’s that intimate relationship, local representation in West Michigan every single week, myself and or Katie. And again, we don’t have a model and this is a positive.

Where there’s a toll free number that is 1 800 GOOD LUCK. Um, it’s that cell number, you know, it’s a concierge boutique type carrier that, um, many agents find value in, particularly in today’s changing world of call centers. Outsourcing. Yeah. Like we talk about when we interview all of our carrier, our partners, if you, you know, certainly at the end and, and in the links we’ll give Daryl’s information and gimme a call and we can, you know, hook you up.

If you don’t know one America, Daryl would be more than happy, but wherever you are, he does work with some colleagues, so it could be that you, you know, you’d be working with one of his colleagues. But if you have, if you’re curious about, we will talk more about one America throughout the talk. But the reason why I wanted to bring Daryl today.

is, um, gosh, for a while now, D, we’ve, we do employee benefits, one on one at BPI. A lot of, you know, that in the audience and that happens every Wednesday morning. And we basically teach benefits on a very real basis, real world basis, like. Ground level floor level stuff. So we have a lot of new employees at BPI, young folks that are still learning the ropes.

And so we just take an hour a week and we teach them. And some of our older, uh, employees have been around a long time. They, they sit in and too, because we’re always digging into new ideas. So I’ve had you speak, Daryl, gosh, three or four times at that now. The audience loves it because what Dee has done is he’s been around.

I mean, I hate to date you, man. Maybe you said it was 1997 when you got into sales, but he’s seen a lot and he’s always been in that life and disability side has the underwriting background worked at, you know, Dearborn, UNUM, One America, CNA. Um, and he’s seen, he’s seen a lot through the years, but he also has, does a really good job of, uh, helping our agents understand kind of, you know, The different parts of LTD, STD and life.

And a lot of times we’re getting to the point here. We do a lot of proposals at BPI where someone will email Joel and say, Hey, match LTD, which is 60 percent to 6, 000 to SSNRA at age 65. I mean, how many times those of you in the audience listening today, how many RFPs have you sent out that match current, you know, and what D Daryl and I talk about a lot as was.

Daryl’s, um, competitors is, Hey, do we, should we rethink that 60 percent to 6, 000? Like we’ve been doing that a long time. Like, and so today what we’re going to do is dig into some of the things that Daryl’s pointed out to me through my career that have helped us help to sell business.  Um, and so we’re going to talk about some LTDI items, some STD items and some group life items. 

And the first is jumping into long term disability, Daryl, let’s talk about duration.  Um, one of the things you talked to me about right away was,  uh, have you ever, we always do SSNRA.  Should we first describe what SSNRA is for the audience and then why we might want to rethink that? Probably a good idea seeing that we’re in a business of acronyms.

It seems like very often. So, uh, yeah, exactly. So thank you. So SSNRA is social security normal retirement age, which is to age 67. I don’t know the exact year where that changed, but obviously people are living longer, working longer, fortunately, for a lot of different reasons, medical technology, education of.

Of a well being used to be the idea. One schedule, Americans, disability, employment, and schedule one, which was to age 65, which was the normal social retirement age, you know, probably 25 years ago that it became SSNRA. So that may really get right to your point. You know, I think we could all agree that any successful agent, salesperson, account manager, you’re going to learn a lot more with your ears and you certainly are with your mouth.

So it’s just.  Having those listening skills and understanding and asking probing questions as to what’s worked. And if it hasn’t worked, why? Um, and I would, before we get into the mechanics of this, I would say that, you know, I’ll put myself in this category at times as well. I think as an industry, we tend to get complacent.

Meaning, hey, it’s what they have today, just match the contract, right? And then it becomes all about the rate too frequently. And we’re all trying to get off the rate game, right? Because there’s a lot more to the, to the, to a contract, whether it’s the customer service behind it, the financial strength of the carrier, the contract provisions, the rate guarantee.

Or like, what audience are we insuring?  What you’re going to talk about, right? Are we talking, are we insuring doctors? Are we insuring lawyers? Are we insuring folks who mainly blue collar who are on a like manufacturing floor? That’s a big deal too, right? And the other big issue is the general agent behind it. 

There you go. Yeah, no. So I would say the industry norm is SSNRA, Social Security Normal Retirement Age. Where we’ve seen a really nice impact is broadening people’s perspective of why and where a five year benefit duration LTD contract makes sense. A statistic that we often use, and this is not a one America statistic, this is all group carriers combined on an aggregate level.

Average group long term disability claimant is on claim for only, on average, On average, 39 months, 39. Yep. And we, you can Google that. If you’re listening to this, you’re in, you’re doing, you know, whatever you’re doing, you can Google that. It’s very easy to find. I’ve, I’ve double checked Daryl’s work on that, but 39 months.

But what does that mean? Let’s think about that. Like, let’s dig into that. So if the average claim is 39 months. You’ve always told me, then why are we doing SSNRA? I mean, sometimes it makes sense, right? Yeah, for sure. I mean, the SSNRA is a security blanket, right? Like it’s a feel good just in case.  that small percentage of the time it goes beyond 39 months.

So, you know, the audience may be wondering why 39 months, like what’s going on? So people are either fortunately, hopefully best case scenario, returning back to work within 39 months, or they’re permanently and totally disabled and they’re qualifying for social security disability awards. Or in some instances, Unfortunately, they’re passing away, right?

The other statistic I’ll use is that 88 percent  of all long term disability claims are closed out within 5 years. Again, for those three  main reasons. Death, return to work, or Social Security Disability Award. So one of those three is happening. So if you’re in that 12 percent range, it’s going to go over 5 years.

So yeah, Dom, I mean, Some companies are going to feel more comfortable having that SSNRA benefit state 67. You can get creative. You might want to carve out a segment of that population, whether it’s a salaried people or maybe the corporate officers or the shareholders, the owners, um, maybe individuals earning over certain threshold per year, give them that 65 or 67 benefit.

I want to use another case study that I think is very valuable, um, for our listeners to understand. Uh, real life examples, about two years ago, the agent brought me an opportunity and said, Hey, we tried a group long term, voluntary long term disability offering. On a 400 like trucking group, and we got 11 percent participation.

And again, mind you, most carriers are going to require on a voluntary basis around that 25 percent minimum in order to issue the contract. So in that example, the carrier walked away and said, sorry, you didn’t, you know, you came in short, so. It was brought to my attention. Hey, we want to give you a shot at One America.

And I’m thinking to myself, okay, well, first of all, thank you for the opportunity and I think you, you know, you and your team at Benefit Profiles was, were involved with this case from a employee navigator perspective as well. Um, so you, Helped in the education and the, uh, in the, in the process as well,  but, you know, the feedback was, you know, why did they only get 11 percent participation?

The feedback was the group LTD program was not affordable. It wasn’t within the budget  and what they offered was 60%, which is industry norm, but they offered a SSNRA.  So, you know, through the education process with the agent, the agent then went back to the risk manager and the HR director within this logistics company, explain what a five year benefit duration would cover.

And the rating factor, it saves about 30 percent premium for an SSNRA. So by offering that, you know, we went from what was 11 percent with a SSNRA. Once we offer the five year with a more affordable. Premiums attached to it. We got upwards of about 38 percent participational, right? So we were able to place the case and in the folks that wanted that insurance could get it cause it was voluntary and they are truck drivers, which are tough to ensure  if I’m going to five year, what am I giving up?

I mean, If the members, we know that the benefit will only last five years, right, but then most people should, at that point, have social security benefits. Is that correct? Well, yeah, I mean, if they meet that definition, right, permanent and totally disabled, then they would theoretically qualify for those disability awards, and then the underlying group contract would just pay out a minimum monthly benefit, which is You know, usually maybe 50 or 100 a month.

Yeah. Cause when someone goes on social security, Daryl, then the group contracts going to offset for social security. Is that correct as well? 100 percent dollar for dollar. Right. So five year benefit gets them there. Um, you’re really not giving up too much. Is again, going back to the stats, 88 percent of claims are closed out by that point.

So, uh, it’s, I’ve used it as well. I’ve used it in budgets.  People are like, oh man, that we want, we want to do STD and LTD. I’m like, well then let’s, let’s do it.  That’s the first thing I go to. And probably because of you is I go, let’s do five year first. And then we do the education. So those of you out there, um, you know, if you, if you don’t, you can always just call me or Daryl.

We, we love this stuff. I mean, I, anytime any of you have a case and you want to just kind of be creative, I mean, you and I would do that all day, right? D I mean, we love that stuff. So that’s the first place I would go. What else on LTD  should, should we highlight? Before we go to the short term, um, we are going to talk some terms toward the end of the talk.

So maybe we can pause and wait for those terms. Um,  any other case studies that you would mention that you’ve had success doing? We’ve done some work around gross ups. So, you know, the concept here is that if, if it’s employer paid, which there’s a fair amount, you know, a large percentage of Long term disability contracts in our Michigan marketplace that our employer paid.

At time of claim, it’s a taxable benefit to the insured.  One way to get around that is to gross up the product. So, in the simplest terms, is let’s just pretend somebody’s earning 50, 000 a year and the employer’s paying 100 per month for that, I’m sorry, 100 per year for that long term disability program.

They would simply gross up their W 2.  So it would reflect 50, 100. And then whatever their payroll frequency is, whether it’s, you know, weekly, bi weekly, bi monthly, whatever, they would payroll deduct on a post tax basis. And then at time of claim, it’s a taxable benefit. Now there’s a rating adjustment factor.

Carriers are going to charge a little bit more for that. Um, I’m going to use a term that you absolutely love and that’s malingering. I love malingering. Don’t let it malinger, Aspect in that the higher the income replacement ratio, right? Now you’re going from 60 percent taxable to 60 percent taxable. Tax free, not taxable.

Right? Yeah. So that’s like almost 70% right? Or 72%. Uh, it’s probably more than that percent. Now you got people that may be a little bit more inclined to say, geez, you know, pretty comfortable with this disability. Yeah, no doubt. It’s not all good. I’m just getting, almost getting a hundred percent of my paycheck.

I’m just gonna hang out. No taxes. Right. And you’ve reduced a lot of your living expenses, right? You’re not driving to work, you’re not doing a lot of other Yeah. You’re not going other, yeah. Things associated with that. So that’s another concept, you know, it’s a little bit harder to explain to some HR individuals, uh, and there’s some additional administration associated with it, but I got to tell you, boy, At time of claim, people love it because it makes a significant difference to their take home.

And for the audience, just my real, real world experience, you can’t decide once we sell a case, like, Oh, this is a gross up. Like we rate for that. Just what Daryl talked about with the, the great, see Daryl’s got some great terms. So malingering, literally means people hanging out on the benefit when they really should be back at work.

So you, you have to tell us upfront, Hey, this is a gross up. Typically we sell gross ups when we’re digging into a case and the, uh, an agent might say, well, they’re frustrated with the, the benefit level, like an HR person would say, Hey, this is not enough for these people. And so then we’ll start getting creative.

The first thing we’ll do is try to increase the maximum But a lot of times if we have the right max, the next lever we have is that gross up opportunity.  Um, so that’s a really good one, Daryl. Thank you for bringing that up. Cause I forgot. It’s not even on the agenda. That’s a really, really good one. You know, down to it, that gross up applies not only to long term, but you can also do it on short term disability as well.

Yeah, that’s right. Okay. When it comes to long term, there’s waiver premium stuff. I want to kind of come to that when we talk about group life in a little while. Let’s jump into short term disability. One of the things you’ve highlight for our audience, a lot for our, our students is that you talk again, match current.

So most of the time we’re at zero seven,  13 or 26, right? So all the audience understands a short term disability, you have those waiting periods, you typically it goes accident illness. And for how long is the benefit going to last? And I mean, how many times are we zero seven? I mean, most of the time, right? 

And so you’ve given me some ideas, like, why are we doing first day accident? So do you want to talk about that a little bit? Love to. Yeah. Honestly, I do. I know. So yeah, we find here in Michigan, obviously it’s a very benefit rich state for a lot of different reasons. And in my experience, I see a lot of, as you stated, a zero seven, also one eight, it’s all the same thing, right?

Same thing. Right. Yep. Yep. first day accident, seven day sickness, benefits paid on the first or eighth day. Um, but you know, again, and I love these statistics and again, you can validate them on the web. Um, only 10 percent of all short term disability claims are accident related. Gosh, that’s huge deal. It’s a huge deal.

I know it is. And so, um, for those that have taken our BPI One America rating factor courses. Um, you’ve learned that, you know, if you change from a zero seven to a seven, seven, there’s obviously premium savings associated with that to the tune of about eight or 9%, so pretty significant. Yeah, that’s great.

And then where we’ve had a lot of success. Again, most carriers have a first day hospitalization rider. I can’t say that it’s talked about frequently in the market. Um, but another stat is that about 37%,  let’s round up like an underwriter would and get a little more out of it, a little more juice,  about 40 percent of all short term disability claims in the market.

are maternity related.  So let’s talk about a maternity claim. Um, because it’s a sickness, benefits begin on the eighth day or fourth day, depending upon how the plan’s written. And, um, if you have that. And then everybody always has a stupid joke about maternity. We’re not as a sickness. We’re not going to do that.

We’re going to forego that on this one. So you’ve got a situation where if you have a first day hospitalization  Benefits would begin immediately. It waives the elimination period completely, almost like a zero day elimination period on sickness. Now,  the definition of a first day hospitalization, it’s not waiting in the waiting room.

It’s actually getting admitted to a hospital room and you’ve got to be admitted generally for, it depends on the contracts written, 12 or 24 hours, maybe 18 hours, but I think we can all agree on this call that the vast majority of Paternity claims occur in a hospital and the claim is in the hospital for at least 24 hours.

So, you know, if, if you look at like, you know, the demographics of a group, this is where I think, you know, a lot of agents do a really good job. And I think, again, with the right general agent and carrier partner, they’re there to, to, to help in this facility, um, or to facilitate this, but look at that census and say, geez, are there a lot of females?

What does that look like? Yeah, gosh. Are there a lot of females in that  18 to.  You know, 39 year age group,  45, you got it. That are, uh, uh, childbearing ages. And what does that look like? And what would that be? And so again, just kind of creating some new solutions and, you know, particularly for agents that are prospecting out there.

That’s what I was going to say, Daryl. What a great idea for prospecting, especially for doctor’s offices, dentist offices, insurance agencies. You’re absolutely right. I’m actually kicking myself because we did one.  I’m actually going to call an agent after this podcast because, uh, but yeah, it’s a high female population.

Let’s go. Let’s go. Let’s crank up that accident  and let’s do first day hospitalization. You can even do  1414 and especially if it’s voluntary short term disability, you can make it more affordable, right? I mean, we can raise that waiting period for the first day accident and the illness and then put that hospital rider in and still give folks really the majority of the short term disability claims in a large female audience would be maternity.

So, giving them that protection. I’d be remiss not to mention that, you know, there is a load for that first day hospitalization. Yeah, there is. You know, it’s in that 9 percent range, so it’s about a wash. If you go, if you move it from a 0 7 to a 7 7 and then you tack on that first day hospitalization, you shouldn’t see any increase or much of an increase.

It’s going to be about cost neutral. But probably a better design. You’re helping more people. 40 percent of people go in for childbearing versus 10 percent for accident. It’s a better plan design. I, I would absolutely agree with that in most instances. Now, you know, if you had a very dominant male, you know, maybe like a foundry or something very active. 

heavy blue collar where there are accidents. But again, that’s going to be a lot. If it’s happening on the job, it’s going to be worker’s comp, this is all non oc, you know? Um, so yeah, I, I would say probably 95 percent of the time that statement would hold true. Why did we start at zero seven or one eight?

Do we, do we know? I mean, I don’t know. Do you remember why? I just was what it was, right? You know, I’m not that old. Come on.  I just, I’m curious as to why these things just happened, you know, way back in the day. Um, you know, the 60 percent to six grand, a lot of times six grand doesn’t get it done anymore. 

No, it doesn’t. That’s why I think, you know, there’s a lot of other creative solutions, whether it’s individual disability or one America, we have a one lump sum disability program that, yeah, let’s talk about that for a second. So yeah, if you’re, we’re, we’re insurance professionals, right? So our job is to say, Hey, here’s your audience.

Here’s your, here is your population. And we’re wanting, you want to ensure your folks for short term disability and long term disability.  What Daryl and I are talking about is looking at the, looking at the population, looking male, female content. Uh, you know, what kind of like, are we talking again,  education background, a lot of different things, socioeconomic stuff and designing the program around that versus like what we 60 percent to six grant. 

So finding ways, creative ways to give people insurance for when this disability occur event occurs. And we didn’t even talk about Daryl, uh, why we think disability is the most, the second most important insurance besides medical, obviously, but we can do that again.  But you have this product at One America called One Lump Sum, which is a way to, I wouldn’t call it supplement.

Would you, what would you call it? It’s just another creative way to help folks in an event of a disability. Yeah,  again, to my knowledge, again, been doing this 31 years, strictly life and disability, solely focused on, on these product offerings. I’ve yet to see a carrier offer this product. And I, every single agent, it’s been  several hundreds or thousands have confirmed that for me, but the one lump sum is either on a voluntary basis or employer paid.

And it, it pays in addition to also known as does not offset with any underlying group plan, individual disability plans, or social security disability awards if they qualify. So, um,  most often it’s.  It’s put, it’s, it’s layered on top of a group plan and One America does not have to be, and we’re often not the underlying group program.

Yeah, yeah. And it pays in addition to, after you meet the elimination period, it would pay a lump sum benefit ranging from 10, 000 to 50, 000, whatever the employer or the employee elected at time of application.  Now, the test of disability is stricter, a group plan, a group plan is, you know, again, Most often, particularly if it’s been written in the last 20 years, the the definition of disability is gonna be total and partial.

Yeah.  This one lump sum requires total and permanent disability. One that’s expected to last at least two years. So it’s harder to qualify, but the affordability of the premiums take that into account.  And the beautiful thing is, is it pays in addition too. So lemme give you, lemme give you a a real life example.

Um. It was about a month and a half ago, agent brought me into a engineering firm with 35 people in the Ann Arbor area, 7 partners,  and then about, you know, 27 employees.  And, uh, they had an underlying group plan, 60 percent to 15, 000 a month with another carrier. The carrier would not That’s a big, that’s a big group plan.

60 percent to 15, 000. It is, Don. You’re exactly right. Particularly on a 35 life group. Yeah, it sure is. The group carrier was not comfortable increasing the max any more than 15, 000, which is not surprising. Yeah, not at all. No. Five of the seven partners had an individual disability plan. Yeah. And you might be wondering why, what happened to the other two  and individual  underwritten.

You got it. They were, they’re unwritten policies. The, the two, for whatever reasons, due to health conditions, apparently weren’t able to qualify  and they wanted more disability. So a natural fit. Was this one lump sum, the employer, this engineering firm paid for the seven people, the partners, 50, 000. And then the other roughly 25 people, they offered on a voluntary, voluntary.

Yeah. How much is that a month for like, and you get, just so the audience knows you, if you become, if you’re deemed disabled for two years, one America, you send out a check for 50, 000 bucks and the member can use that money for whatever, similar to. an accident plan or critical illness. But, um, how much is it on roughly 50 grand?

Yeah, super inexpensive. Um, it’s age banded, much like a voluntary life, voluntary disability. So for like the age band 35 to 39, 50, 000 is going to be 3 a week. Yeah. So yeah, nothing. And then again, you can go down to a 10, 000 benefit. You know, 25, 000 1. 50 a week in premiums. It’s super affordable. And the agents, for the agents, it’s not like this is a goldmine for you, but again, a cool, like, you know, it’s a neat value add to your,  to your offering.

It’s a very, it’s much cheaper than critical illness, Daryl. Oh, for sure. Crazy. Now you wouldn’t sell it like critical illness either. You have to have a full disability, but pretty unique and neat offering that you all have, for sure. So, yeah, it’s really, we’ve really, uh, had a number of agents grasp onto the concept and use it very effectively, not only for their own agencies, you know, again, the concept of, hey, if I’m going to sell the cat food, I might as well be eating it, right?

Like,  have that conviction, believe in the product. And then go out there and, uh, educate and promote it to your enforced clientele. Yeah. All right. Outstanding. Um, by now the audience is either really captivated or if they’ve fallen asleep, I don’t care. Let’s keep rolling. This is a couple of insurance dorks.

We’re going to get real into it now. Okay. So, um, again, for the, I keep reiterating this, but man,  if ever you want. Daryl kind of takes us on the road. So if you want Daryl to come to your office, I highly recommend it. He brings really good materials and it’s an hour. Well spent maybe actually D probably two or three hours.

You can spend where you, um,  you really could, uh, you go through like rating. So different aspects of contracts, how much does it cost? It’s always very well, well received. I’ve, I’ve been in agencies with you and they really appreciate it. So that’s a little plug. Okay. What we’re going to do is. Okay. Daryl has, we’re going to go through insurance terms.

Um, I’m going to quiz him and he’s going to tell me what these mean. Cause all of you look at your LTD, uh, certificates or your proposals or you’re doing spreadsheets and there are certain terms you’re just like, what the heck now I like puns and I always mess around with my staff. Like, so the first one is COLA, Daryl, when it comes to long term disability.

COLA.  Is it important? And. Are they, is it pretty common now? And in most contracts, tell me what you think about cola, not Coca Cola, but cola itself, Pepsi or Sprite. Yeah. So again, going back to the acronyms, cola stands for cost of living adjustment.  It’s on an LTD contract very, very, very infrequently, probably less than 2 percent of the time.

Do you have to ask for it then? Yeah, the agent, the agent would request it. Typically we, I personally, and I don’t think many of my competitors would proactively offer it on a contract or in a proposal. Is it expensive? Very expensive, particularly with inflation. So a Kohler Rider does just that, right?

Like, so you get 60 percent on average, maybe the contract’s written 40, 50, 60, two thirds.  Yeah, just that monthly benefit. on an annual basis by the cost of living. And the cost of living adjustment rider on a contract would range from a low of 3 percent and a high of 10. Very expensive. Where did you see that in your career?

Is it union groups or is it just very specific advisors who just love to sell cola? Yeah, great question. I, I honestly have not seen it in a contract for probably over 10 years. No kidding. No kidding. It was more prevalent way back when you would see it, at least from my experience. And that’s not the end all right.

Like I just read a small portion. Uh, I’ve seen it long time ago on heavy white collar physician groups, law firms,  premiums that they’re paying. on an employer paid basis because it’s a tax, you know, taxable or not taxable, but expensible. They’re not too concerned about what they’re paying. They’re concerned about if they go on claim and really good protection.

Yeah. Okay. Okay. Great. Um, so we talked about malingering. Let’s talk about residual benefits. All of us who spreadsheet LTD, it’s like it most, uh, spreadsheets. Most we use perfect quote. That’s one of the things that, that we kind of fill in is residual yes or no. What the heck does that mean to a client?

Most of the time, the staff doesn’t know what that means, but  what does it mean from your perspective? And is it common? It’s common. A hundred percent. It’s common. It’s been common for years. Um, from my perspective, residual means that  you do not have to be  totally disabled. You can be residually disabled, have some residual income from partial work earnings and still qualify under a group long term disability program. 

So is that for salespeople? You know, they might have some money coming in, but they are not working. Is that, or is that more partial disability? Or is that? No, it’s probably residual, wouldn’t it? It’s residual. I’ll put it in the terms of our audience. Let’s pretend you’re an insurance agent and you go out on disability.

And because you’ve got a great supporting staff at your agency, maintaining those existing relationships, clients, probably not going to see a dip of your income, right? Right. Just because you go out on disability doesn’t mean that your clients are going to leave because again, you’ve got some phenomenal account managers, staff within the agency, and maybe other agents within the agency.

Uh, agency that’ll pick up some of that, that work. So, so that, in that instance of the agents still making money, but they claim, why would they claim out? Like, well, if, you know, if there’s money coming in, why would I, why would I go on claim? Do you think? Probably wouldn’t. Well, it depends on how the contract’s written, right?

So long, some long term disability contracts are going to have, we’re going to get pretty deep here. They have an and definition of disability. Yeah. Some contracts have an or definition. So let’s talk a little bit about that. If there’s two, there’s two criteria within a contract, a loss of income, which is usually mandated at 20 percent or greater initially, And a loss of occupational duties, the inability to perform the substantial and material duties of your occupation.

The occupation you are in on your date of disability. So under an OR contract, it’s broader based, easier to qualify. And definition, you’ve got to have that two pronged approach and hit on both of them. Yeah, so if I go on disability and I, and I qualify because it’s an or contract, but I have some income coming in typically groups are going to offset for that money.

Correct? On LTD, typically carriers are. Yeah, yes, that’s, that’s a true statement. Yeah. Yep. Okay, but  if I’m going to be out for a long time, it’s still important to claim. You never know, right? Like the, the agency might have to make a decision. Hey, you’re, you’re going to, you know, you could, looks like this could be a long term disability, right?

So that’s where that comes in. The residual comes into play. I would think, right? You’re, you’re, you’re, you’re exactly right. Okay. So residual, COLA. Gosh, darn it. What do we, there was another one I wanted to talk about. Let me look at my agenda.  Self reported. Thank you. Self reported limitations. What does self reported refer to?

You see that in some contracts. Don’t let it scare you at all. It became an issue 20 years ago. There’s one prominent carrier that came out with it and they had some prudent person wording in there that is, Oh, that’s right. Prudent person. That’s right. You don’t see that in contracts anymore. A prudent person. 

That really gave the carrier a clause or an opt out. So for example, if somebody said, Um, boy, I feel like I may have, oh, I don’t know, say it almost like a pre act. Okay. Go ahead. I’m interrupting a growth on their body and they don’t do anything about it. And then they, then they go to the doctor a year later and like, yeah, you’ve got a tumor. 

The carrier could say, well, a prudent person would have sought medical treatment  far sooner than. A year, year after that, they noticed it, right? Right. So.  So very nebulous. It’s a very, so. Yeah. The prudent person thing. But I don’t want to get too hung up. So I apologize to those that are listening to this, that maybe I shouldn’t.

So the prudent person is not relevant in today’s market. Self reported sometimes is. I would say it’s probably in, I don’t know, 60, 70 percent of contracts and a self reported really is to protect the employer and their experience from  employees. Trying to become claimants and saying, geez, um,  I’m disabled because I have this chronic fatigue, maybe  fibromyalgia, things that are not readily detected through a CT scan and X ray or a blood blood work, blood work.

And that’s tough, Daryl, because, uh, you know, we’ve had, you and I have a mutual friend who’s had Lyme disease. I mean, really, really bad. And he, And he was out on disability and  his carrier, he happened to work for a carrier who he had that disability through that carrier. And he had a fight on his hands because of that self reported, because the self reported claims sometimes have a limitation, a two year limitation, correct?

Yeah. Two year limit. Yeah.  And it, with Lyme disease, it’s very hard to detect even though we all agree it’s a real disease. It doesn’t always show up on the blood work. So then people are like, well, it’s, you have chronic pain or chronic fatigue. So, um, that’s what self reported refers to, correct? How do you all handle that at One America?

Do you have a limitation on self reported? Well, we handle it, we handle it like most carriers. We, our standard is we include it. But if the agent wants it removed, he’ll take it out and it marginally changes the premium. Do people even tell you to take it out anymore? Most of the time they don’t. No. I would say this.

I think the industry overall, carriers are doing the right things. They’re not hiding behind these limitations and saying, ah, it’s fine. universally recognized that, you know, again, everybody I’m going to assume is working in the best interest and would agree that if it’s, you really can’t detect it, if it’s back claim, like whatever, um, you know, musculoskeletal.

Most people are going to come back to work with them two years anyhow. So it’s not that big of a deal anymore. Right. Okay. Those are those terms that I wanted to highlight. I want you to just be, when we land the plane here, when it comes to disability, I’ve been, I’ve been in the business 20 years, you a little bit longer.

When I first got in the carrier reps talked about contracts all the time. And what I’ve picked up from you is  do you feel like contracts have become more homogenous? In other words, they’re. In other words, they’re not, there’s not as much variance between them, or do you still feel like there’s a ton of variance, or is it a tough question?

There’s still a decent amount of variance. Is there? Yeah, Dom, there is. I would say that, to your point,  agents overall have become less concerned about it. There has been some standardization, so I’ll give you an example.  Some carriers had a total only definition of disability. We’re going way back when, right?

Um,  I don’t, I don’t think there’s a single carrier out there that requires total disability anymore on a group LTD contract. Right. So, you know, there’s those protections there. There’s some assumptions made that are accurate that, you know, that doesn’t really exist standardly anymore. But if you really dig deep, if you’ve got that law firm, if you’ve got that doctor’s practice.

There are some carriers and when America’s not the right fit, I would say we’re more blue to gray collar and some white, but you know, there’s some carriers that will offer like a specialty ONOC language. And that’s important in my opinion for certain industries, again, predominantly for physician groups and law firms.

And we have markets for that at BPI. I’m really proud of that. Yes. There’s just some carriers that prefer white collar. You know, that’s also my, my advice to the audience to ask your reps, like, what do you like? You know, Darrell, you, you all, you guys do have a niche. You will, you have no problem with. Kind of public groups or some carriers just don’t like public groups.

So I would ask you, and that’s when people say, well, how do I pick my panel? I’m really into that lately. Like picking carriers that work for you as an agency. I think the rep has a big deal with it. Do you get along with the rep? Do you like the rep? Do you, you have a good rapport with the rep and then also putting.

Uh, in your panel, I don’t think you need to go to 15 carriers. I think you agree with that, right? D I it’s, it’s a little silly four or five that, you know, where the niche is and you can really work that and form relationships that goes a long way. Don’t you agree? Oh, a hundred percent. I mean, first and foremost, you’ve got, I would look at their service model, how long the rep has been in the business, how committed you feel they are.

Yeah. Um, cause again, there’s nothing worse than buying something and then When your client has a need for it and you’re dealing with Bigfoot, that’s a real big problem. Yeah, that’s right. Um, man, we could talk to you for all day. We didn’t even get into group life at all. Um, and that might be a whole other conversation another time.

Um, but I, I really appreciate it. I think the audience got a sense of who Daryl is. You know, it’s been a fun relationship. We, you know, we’re totally partners with one America. If you have any questions about, or we want to learn more, just give me a bump and we’ll, Darrell will come out. And again, if you’re in Southeast Michigan, it might be as one of his colleagues, but that’s, it’s Dan Oprita either way, um, and we’ll come and we’ll, we’ll chat about it.

Anything you want to, you want to leave the audience with any message of peace, Darrell? Yeah. A couple of things. Um, you know, I think one of the many reasons why the one America  products and services aligned so well with Dominic and his, his firm at Benefit Profiles is our culture. And, you know, I always like to say that people really don’t care.

They don’t care how much you know, until they know how much you care.  And there’s a strong level of sincerity, I think, between, um, the team here at One America, Dan Oprita, our manager, Katie Ochinski, our account manager here that covers the state, myself and Dominic and his team, we care. I’d like to say more than most any other insurance, wholesale, general agents, we’re here to help you.

We’re here to give you honest, direct advice. And, uh, when we’re not the right fit, we’ll tell you. We won’t, you know, your time is extremely valuable and, um, thank you for your time today. And I look forward along with Dominic to, uh, to spending more time with each and every one of you at your offices and, and, uh, working with you and your clients and your prospects.

Yeah, and that’s what I, I will say laying in the plane is just, um, I said it in my intro, but you know, Daryl’s very present in the market.  That’s one of the things I most admire about you. There’s still have that battery, man. It’s still, still out and about running back and forth every week. That’s, that’s impressive.

So thanks for taking the time. Really appreciate it. And, uh, we’ll be in touch everybody. Thank you. 

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Dominic Siciliano

President, Agent Consultant

Over his 18 years in the benefits business Dominic has worked in the Medicare Advantage, small group Blue Cross medical, ancillary GA and large group benefit admin space here in Michigan. His parents and biggest influences, Patricia Siciliano and John McClain, instilled in him the key pillar to GA benefits business—relationships with agents and carriers. Dominic has served as the NABIP West Michigan President twice. He’s run the golf outing several years going and he served at the Legislative Co Chair for the State Board during the passing of PPACA. His Friday morning classes, Employee Benefits 101, is highly regarded in the industry as a practical, real world introduction to the business for new folks. In short, he is passionate about our business and about seeing agents succeed. 

Dominic loves golf and basketball but as he gets older, golf more. He’s a Western grad but a State fan! He most enjoys spending time with wife Janelle and four children outdoors and Up North! From the very early days of BPI when it was just him and Lena in a tiny little office, he hasn’t changed, it’s about getting the job done for agents.