Article Abstract:
Disability insurance companies are upbeat about the future following sweeping changes in product design and marketing thrusts. Disability policies have been stripped of own-occupation disability definitions, lifetime benefits and some riders, while focus was directed to more optional coverages from fully paid employer benefits. Since 1994, the sector has been grappling with changes with the decline of premiums, the departure of carriers from the business and the disappearance of noncancelable, high-benefit policies. However, long-term disability insurance has since rebounded and now offers enormous opportunities.
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Article Abstract:
The insurance industry must end its reliance on traditional noncancellable individual disability products. Noncancellable disability insurance (DI) does not have the price flexibility required to adapt to changing realities in the marketplace. New technologies have eliminated traditional definitions of many occupations, making it difficult to write DI policies on the basis of permanent job descriptions. Price flexibility is the key to developing new DI products that will allow insurance carriers to meet future financial obligations.
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Article Abstract:
Benefits under the liberal coverages offered by disability insurers in the late 1980s and early 1990s have spawned several problems for insurance companies. These noncancelable, own-occupation policies, bought mostly by doctors, have resulted in an increase in claims. This, in turn, has prompted a number of insurance companies to impose more stringent claims policies. Insurance brokers are thus spending more time in negotiating to have claims paid.
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