Pathways with Amber Stitt

Physician's Edition: What are Benefit Periods?

August 30, 2022 Amber Stitt
Pathways with Amber Stitt
Physician's Edition: What are Benefit Periods?
Show Notes Transcript

Scott and I dive into what traditional Benefit Periods are on Own Occupation contracts.

We also discuss how a shorter duration can still be useful for someone to have. Sometimes a person will get an offer for coverage but it will have been modified due to their health history.

Sometimes this is on a 5-year benefit window and sometimes there is a rating as well.

Please contact us for more information if you want help with reviewing your current benefits

Thank you for listening!

NOTE: This podcast was transcribed by a free AI transcription tool called Otter. Please forgive any typos or errors.

Amber Stitt 0:02

Scott, we're gonna have you discuss a little bit more on benefit our benefit periods on our contracts, the most common benefit period would be covered through age 65. But you can buy coverage for ages 67 and 70. Commonly, we still don't sell a longer duration. And I think it's because the goal is to get toward reaching your financial independence and hopefully try to save your dollars today and put that towards that the goals that you have in mind.

Scott 0:28

So what are we looking at benefit periods if there's a wider range, and there's a wide range for a number of reasons, that range goes from a two-year benefit period or five years to attend, and age 65 and 67/70. Now, keep in mind, that when I'm saying benefit period that does not necessarily translate to contract duration. You can end up with an age 65 contract, that doesn't appear to be 70. What that really means is if you had a client, and you were disabled at age 65, the benefits would still continue. Most contracts at age 65 of your client will terminate or move into what's called conditional renewal. And when we talked about the two, five, and 10-year periods, you know, there are certainly some folks that buy these benefit periods because it really fits what they're looking to get accomplished.

But more often than not, those benefit periods are utilized by underwriting in order to put an offer on the table but to limit exposure to the insurance company of that particular insurance. So if somebody would be a decline on age 65, they might very well get an offer for a five-year benefit period. Essentially the insurance company saying you know what will insure you we just want to limit our risk. But here's a contract and here's an offer they'll get you something and so if something goes nothing.

I think it gives someone an actual exit plan, exit strategy, whether or not you have to sell a practice or downsize a home, or at least gives you five years to double dip and then figure out what your game plan is.

Absolutely. And if you've got it on your contract, that doesn't mean you're always stuck. In five years, you can continue to ask the carrier to review and redefine the policy to go from a five to 10 from a 10 to earning 65 And that's what you choose. But these are options that allow a company to put something on the table versus nothing.

Transcribed by
Thank you again for joining me, Amber Stitt, in this episode of The Physician's Edition. I’ll see you next time, podcasters!