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If you can’t land the best contract available or get the disability benefits you want, it might feel like it’s not worth paying for. But as strange as it may seem, policies with exclusions are better than no policy at all. 

You might have a less-than-perfect offer right now, but find ways to improve your policy in the future. As the famous saying goes: Don’t miss the forest through the trees.

In this episode, you’ll discover what to do when your options in disability coverage are limited – and why getting a plan in place is more important than getting the plan you want.

Highlights from this episode include:

  • How to weaponize your rocky medical history and find the coverage that best defends your health. (0:40)
  • What the “as of now” phrase means for the policy you were offered today, and how to get exclusions removed or riders included in the near future. (2:41)
  • Why self-insuring quickly drains your finances and how to pick a policy worth every penny (even if it’s limited). (5:50)
  • The ‘bad news, good news, and better news’ about the disability coverage you select (and how to not let faulty assumptions pick the wrong plan). (8:08)

To ask questions on insurance coverage or to get a quote, please don’t hesitate to call us anytime at 704-270-2376, and I’d be glad to discuss your specific situation with you.

Read Full Transcript

Hi, I'm Billy Gwaltney and this is the CYA podcast. This show is for the physician who understands the importance of protecting everything you've worked so hard to achieve. Each week I'll bring you tips and advice to help you cut through the clutter and misinformation and show you exactly what you need to preserve your income and way of life. If you're ready to achieve the peace of mind that only financial security can bring let's get started.

(00:28): Welcome today's episode of the cover, your assets podcast. This is your host, Billy Gwaltney, and I am. I'm excited to be with you today. Today. We're going to address the question. What if I, as a physician applying for disability coverage and less than perfect and have exclusions on my policy. And that is a very reasonable thing to ask earlier today, I was talking with an ophthalmologist resident. Who's had a recent struggle with PTSD and a handful of months ago, he started counseling to deal with it.

(01:01): He's healthy. Otherwise he's been meaning to get specialty disability coverage, never got around to it. And it's certainly on his radar now, as he's kind of faced the first time in his life, when, you know, he's, he's realizing he's not going to stay as healthy forever. And so he wants coverage and his question is, can he get it? And how do the top companies handle this situation? He's never bought any type of disability or, or even life insurance before he's mentioned, he's a bit nervous about it. And cause he's not sure what will happen. And so I kind of walked him through some of what I want to share with you today, which is how we handle these kinds of situations. Underwriters are people, insurance companies are run by people. They, they obviously want to ensure good risks, but they also know that people aren't perfect.

(01:53): And so in situations where there is something that's happened relatively recently, or if there's a, a medical history of a particular type or diagnosis, we can prescreen the situation with the top insurance companies. And so that's what I did for this ophthalmology resident today and already gotten some feedback where Senate to, for the top four insurance companies and their underwriters to set know that they would need to postpone for a year or two. One said that they could potentially offer a limited policy with a five-year benefit period per disability. And one said that they believe they could potentially go with a standard contract depending on the details and obviously verifying, you know, the situation. And so we go through this process and this has happened over and over, you know, thousands of times, literally thousands of times with clients where we can navigate these situations with people's medical history in a way that can hopefully bring them to a positive.

(02:59): Now that you know, well, we don't know yet where we'll end up with this particular person I was speaking with earlier today, you know, it'll be several weeks or a couple of months before we will have the approval or whatever the decision is, but it likely won't be perfect. It's not going to be a perfect policy. It will likely have some exclusions for the psychiatric benefit, for example, or someone has had knee surgery before they could exclude the knee or, you know, any number of situations where there's a pre-existing condition. If insurance companies can isolate that preexisting condition and remove it from the policy, it allows them to cover everything else with a standard contract. And so, again, as I mentioned, this policy likely won't be perfect, but it'll be much better, much, much better than self-insuring and what this client would do. And what I shared with him and what kind of dawned on me to share in an episode today was telling him that what it'll do is allow you to have coverage and then live to fight another day.

(04:02): And I said, have you ever heard that term before it? He said, yeah, I have. And I said, that's what you're doing. You're you're when you can't get the perfect policy because you're not perfect. And we, if we have a medical history, we're in a, in a joke, I hesitate to say perfect because none of us are really perfect, but some people are really clean from a medical underwriting standpoint. They just don't have much, if any history and others, you know, there, there are some hiccups in the past and that's very common. And when we run into those kinds of hiccups, what I encourage clients to remember is secure coverage and live to fight another day. And I say this because we can often go back to these underwriters in the future and have that exclusion reviewed potentially to have the exclusion removed, or if we have a policy with a limited benefit period or a policy where they can't give the future insureability option without verifying health status in the future.

(04:59): And so they won't include the ability to just bump up without an increased coverage, without having to go back through medical review in the future, they could potentially reevaluate that and possibly add that future insureability rider back to the policy. And so oftentimes it's not a one decision today and it can never change for the next 30 years. It's usually, or quite often a decision where they say off. Now here's what we can offer. And in the future, by that, I mean at the first policy anniversary or the second or third or fifth policy anniversary, whatever it is, the underwriters are usually good about stating that upfront at the policy approval, when they will be willing to reconsider to have the exclusion removed or whatever riders that cannot be included now added back to the policy. So now the question becomes, you're a physician you have been given this offer this less than perfect.

(05:56): It has exclusions for, you know, the one thing that you've struggled with in your life from a medical standpoint. And so the question becomes, is it worth it? Should you take it if they'll review it again in a year or three years or five years, why not just come back in the future and start from scratch at that point? And that's a valid question. We get that a lot. And so the way I answer that is, is really by starting with the first kind of obvious component that sometimes we need to be reminded of. And that is that we need to get insurance in place as soon as possible. If an insurance company is willing to offer you a policy and you're less than healthy or perfectly healthy, that is all the more reason to say yes to that contract into that policy because an insurance company, they, they don't make those offers lightly self-insuring is a very expensive event.

(06:53): If someone becomes disabled without having private specialty coverage, or just relying on assets in the bank or an investment accounts or real estate or some group policy or something from an employer that can be in a very aggressive approach. And so securing private coverage of some kind, any kind this with a top company that has the definitions is something that should be strongly considered. First second is don't miss the forest for the trees, just because one particular aspect of coverage is excluded. Doesn't mean that everything else is excluded. So if someone in this particular physician's example that I gave earlier, if they can't have a psychiatric provision on their policy where they're still going to be covered for everything else that's covered under the contract. And so, yes, it would be nice to have psychiatric benefits if anxiety or depression or something like that caused a disability, but to not have anything else covered, because we can't have, that is pretty short-sighted and aggressive from a financial standpoint, again, self-insuring is a risky proposition.

(08:03): There's also another reason to secure coverage that might be less than perfect and revisited in the future versus coming in just as a new applicant, several years down the road, I have a secret, it's a secret just between me and you don't tell anybody. Insurance underwriters in our experience treat existing policy holders better than they would treat a new applicant with the same situation. Once you're in, once you're a policy holder, you tend to get more of the benefit of the doubt. When you go back and ask for other things or additional exceptions or a review of a previously denied provision. And this is especially true with the top companies. Now, they're not going to put this in writing to you there, and they may never admit it to you. But knowing what I know is a as an insurance specialist, somebody that's been doing this for years.

(09:02): I've had conversations with underwriters, I've talked to insurance companies, and there is something to the benefit of the doubt. If you've been a policy holder, you've paid premiums, you're two years into the future. Let's say this client that has PTSD, that he's been treating, we go two years into the future and things have stabilized. Things are, things are maybe improved to where he doesn't need counseling, or what have you. Then we could potentially go back and have the psychiatric exclusion removed. But even if he's still getting treatment, there's a chance we could go back and get the future insureability option at it. If it's a limited benefit period, we could potentially get that benefit period extended. And he has a arguably a better shot at that. If he's already a policy holder, then if he just waits and revisits it from scratch three years from out now, that's not always the case.

(09:52): And again, that's not, that's kind of a inside baseball kind of thing where I'm giving you some insight as someone who, who deals with these companies and works with them behind the scenes, that the benefit of the doubt is something that, that you shouldn't just pass by and never think about also who your broker is matters as well. And now brokers, you know, I'm not an underwriter of course, but we can help further the benefit of the doubt. If we do a lot of business with these companies and they know who we are, and they actually liked me, they know it's one thing for your company to know who the broker is. It's another thing from the actually liked the broker that benefit of the doubt can factor in where if something's borderline, if something's kind of could go either way, the benefit of the doubt has the potential to skew it to your advantage.

(10:42): Now, again, that's not a, that's not all the time. I have to caveat that with, you know, there, there are certainly times when exclusions can't be removed, but there are times when the benefit of the doubt certainly helps secure the best coverage. Occasionally I run into physicians, who've been offered coverage and they tend to make some faulty assumptions like if they can't get the absolute best contract, then it's not worth paying for, or they downplay the chances of other disabilities. Hey, if I can't have the psychiatric provision, then what's the use. Or if a female has had complications from pregnancy and they say, well, I, if they're not going to cover pregnancy, because it's a pre-existing condition, then what's the point in having coverage. And I, I certainly understand that that argument or that point, but I believe it's really important to remember that other disabilities can happen and self-insuring is very aggressive at best and arguably foolish at worst.

(11:43): And so it's just something you want to avoid. If you can, if you have a health history and one of the top companies will give you specialty coverage, even within these limits, it's just highly, highly advisable to secure the coverage and lock it in before the ink dries, lock it in before anything changes in your health history that could remove that offer or rescind the offer and then reassess down the road. Again, it's a, it's a bad news. Good news, better news. Ultimately the bad news is we can't always get the perfect policy because we're not all perfect. In fact, none of us are perfect, but some of us have health histories that preclude us from getting a policy without additional exclusions. And that's the bad news. The good news is we can still often get something that's really, really good. That's absolutely worth every penny that you would pay in premium.

(12:35): And the better news is that eventually we can, at some point down the road, hopefully revisit with the underwriter and improve the coverage as things stabilize. And so just food for thought, as you consider your options, as you consider coverage, I feel like I'm all over the place today. This is there's a lot of places that this conversation could go depending on different exclusions or situations. Please feel free to text me anytime to arrange a conversation. If you'd like to discuss further. My number is (704) 270-2376. Again, that's (704) 270-2376. I'd be happy to chat with you and help any way I can until next time. This is Billy Gwaltney. Thank you as always for your time. I really appreciate it.

(13:26): This is ThePodcastFactory.com.

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