A series of very unfortunate circumstances occurred in this excellent article concerning a “Disability Insurance Debacle” found on https://www.whitecoatinvestor.com/5-financial-mishaps-that-led-to-the-physician-philosopher-blog/. As an independent insurance agent for over 22 years I have seen nearly everything happen…good and bad in our industry. I have seen individuals with diagnosed medical history that would normally lead to automatic declination via traditional underwriting take advantage of the referenced Guaranteed Issue individual disability insurance programs…additionally, our office has administered these programs at major institutions and helped clients with securing benefits while on claim. These are the “good” things that financial groups can bring to a hospital.
In another example, when a resident has information about guaranteed issue availability but then is persuaded to work with another agent who has them apply for coverage that requires medical underwriting that ultimately leads to a declination (like what happened in this individual’s story) we are stuck with our hands virtually tied behind our backs without access to the guaranteed issue traditional disability insurance programs that most residents and fellows truly need and covet for income protection. This is an example of the “bad” when agents are trying to force new sales.
Our experience has rested mostly in the middle…where other regional or local agents are in the business to sell insurance to their prospective or new clients, we always have a handful reach out to us to ask if we can help them/their client with access to the guaranteed issue option. We are happy to oblige as it is truly in the best interest of the client. We always split the commission with the referring agent so that ultimately, everyone wins…the key here is that the agent with the relationship needs to be financially and professionally responsible in asking pointed medical questions that are often uncomfortable to bring up or discuss…maybe there’s fear of asking such questions that are perceived to be “too personal” and it could jeopardize bringing in new assets for money management? Maybe the agent isn’t aware of guaranteed issue programs that are often available to residents? For whatever the reason, we see a handful of individuals hurt every year by irresponsible agents who simply don’t take time to evaluate all available avenues for the client. In some cases, it’s not malicious…the agent or advisor may truly not know. For this reason, a degree of responsibility certainly falls on the physician to do a bit of research…check with HR, check with older faculty/physician leaders, check with older graduated peers…more often than not, there’s that one “engineer” type who has completed all of the possible review and comparison and it might save a resident or fellow HOURS of time by getting his/her opinion and simply copying the protocol.
Fortunately, at www.InsureSTAT.com, we have access to a proprietary disability insurance product designed to help graduating residents and fellows secure lump sum benefit protection to replace income or specifically pay off student loans. Issued outside the “normal” underwriting criteria of US based traditional carriers, a Lloyd’s of London coverholder works with us to often secure policies that most assume they can’t get from other sources…we always welcome those situations as most of the time, there’s a frustrated consumer who maybe wasn’t treated the way they needed to be on the other end of the phone call.
Lastly, in defense of a hospital or referring institution…there’s very little way to know what goes on behind closed doors of a financial planning or insurance agency outside of referrals, recommendations, and due diligence up front. I’m not saying that it’s acceptable or ok to have a planning company be indicted for fraud or for hurting clients in any way at all. What I AM saying is that just like when we as agents recommend one insurance carrier and their products over another, we do our best based on experience, overall value, and competitiveness to bring the very best programs and options to our clients. We can only make recommendations based on the information we have in front of us. In today’s age, there is far more transparency required by government agencies to make any and all information available for evaluation but, again, ultimately, we are humans making human based decisions.
Not all “insurance guys” are bad. Not all financial planners are just “in it to make money.” While both professions do pay commissions or fees sometimes…a lot of the time, the advisor or agent truly does EARN that pay by doing the research, helping the client and doing the right thing.
Danny Mensh is the CEO of InsureSTAT, the leading online provider of Disability Insurance for Physicians, Nurses and Physician Assistants.