Impaired Risk Disability Income Program Frequently Asked Questions

1. How long has your primary impaired risk insurance company been in business and what is their rating?

Our primary impaired risk insurance company, Fidelity Security Life Insurance Company in Kansas City, celebrated its 30th Anniversary during 1999 and carries an "EXCELLENT A-" rating from A. M. Best Company.

2. Do premiums increase as the insured ages and can the insurance company raise the premium rates?

The products are considered guaranteed renewable in industry terms. The premiums remain level based on the issue age and we cannot raise an individual's premium rates. However, the insurance company may increase the premium rates for an entire class of business which only occurred once in 1994 on the Blue Collar Program. No rate increases have ever been made on the Graded Benefit Products since the rates were established in 1988.

3. If the maximum monthly benefit amount is $8,000 for the Graded Benefit Plan, will the insurance company issue
that amount regardless of an individual's current disability income coverage?

No, we integrate the benefit amount with other company's DI plans, including an employer's long-term disability benefit, up to 60% of an individual's monthly income. Conceivably, an individual could have more than $8,000 in monthly income protection, as long as the benefit does not exceed 60% of monthly income.

4. How can you write individuals, who are medically or occupationally impaired, and have been declined by the big
standard insurance companies?

We offer two Graded Benefit Plans which pay 33% of the stated monthly benefit if disability occurs during the first policy year, and 66% of the stated monthly benefit if disability occurs during the second policy year. This encourages individuals to stay with the plan for at least two years, after which 100% of the monthly benefit is paid when disabled.

5. Will you write an individual who is either in ongoing therapy or on medication for a past nervous disorder?

Yes, we will consider such an individual for the Graded Benefit Plan provided the situation is stable and does not interfere with his/her ability to work full-time. However, the benefit for individuals with a mental and nervous disorder is limited to 50% of the benefit amount for a maximum six-month period.

6. Will you write an individual who either has had a heart attack, cancer, diabetes, high blood pressure, high
cholesterol, or is overweight?

Generally, we will consider any individual who has had a medical problem for the Graded Benefit Plan, provided the problem is properly disclosed in the application, and has been in remission, under control or stable for the last year. We rely on Attending Physician Statements (APS Reports) from the primary physician to underwrite the case.

7. Will you write an individual who is self-employed?

Yes, but generally, the individual has to provide us with at least one year proof of income from the business, which cannot include passive income earned from investments in certificates of deposit, mutual funds, stocks, bonds, or other similar types of investments where no loss of income can take place.

8. How long does it take to issue a policy after it is submitted to you for processing?

It is entirely dependent on each situation. If a medical problem is evident, we must review the primary physicians' APS report, which takes 2-3 weeks to obtain and review. The licensed agent must also be properly appointed by the insurance company before we can issue the policy. An initial deposit equal to the modal premium (month, quarter, semi-annual or annual) must be paid by the applicant. However, we may opt to mail out the policy and treat these situations as pending delivery requirements. The policy will not be put in force until all delivery requirements have been met.

9. When can we expect commissions after the policy is issued?

Commissions are paid to the agent of record, based on premiums collected every month by the 15th of the following month. Commissions on initial deposits are not paid until the policy is put in force.

Sample Impaired Risk Cases / DI Proposal Request Page / Underwriting Info Form

Medical/Avocation Forms / Blood/HOS Profiles / Medical Exam Hints