Why The Standard Introduced Protector PlatinumSM
by Jason Katraouzos, MBA, FLMI, Product Analyst
Developing a new product is a balancing act involving competitiveness, profitability, diverse markets and distribution channels, simplicity vs. choice in product design, and taking risks vs. maintaining the status quo. The creation of the new Protector Platinum was driven by all those factors.
The most important thing that drove The Standard's product development strategy was listening to you. Many of you told us that you were generally happy with Protector+SM Individual Disability Income (IDI) insurance policy. At the same time, you also identified a number of marketing opportunities and concerns that helped drive the strategy for Protector Platinum. It was clear from that feedback that The Standard's IDI insurance could benefit from additional competitive advantages in order to participate in more markets, and that we also needed to remove some perceived product weaknesses.
Simplicity Plus Choice
The competitive advantage of ProtectorSM and Protector+ was their simple, easy-to-understand product design. That continues with Protector Platinum.
With Protector Platinum,
Residual and Own Occupation
are in the base contract for
There are two important benefits in the base Protector Platinum contract that contribute to a simple product design. The majority of The Standard's policyholders have purchased the Residual and Own Occupation Riders, so these benefits are now in the base contract for all occupations.
Comprehensive Benefits Plus Competitive Advantages
The IDI insurance market has become more competitive since the launch of The Protector+ in 2005. The Standard used to be the only carrier offering features such as Own Occupation coverage to most markets, and now almost every carrier offers that benefit. Many of you asked to see more competitive advantages in a new product that would again set The Standard apart from other carriers.
Here is an overview of those new advantages:
- A new recovery benefit that pays benefits through the maximum benefit period instead of using the lump sum approach of The Protector+. While the lump sum recovery benefit was beneficial for most claimants, this new approach in Protector Platinum will also help business owners recover lost income as they rebuild their businesses after a disability.
- New provision for partial disabilities. We believe the new Partial Disability Benefit is the strongest benefit in the IDI insurance industry for helping claimants return to work. This benefit includes an initial six-month period paying full benefits for a partial disability, with a definition requiring a loss of time, duties, or income.
- Residual Rider language. Many of you found the old language confusing, so terms such as "effectively" have been removed.
- The first Compassionate CareSM Benefit in the industry. If an insured's Loved One experiences a serious health condition, benefits will be paid for a limited time to help the insured provide care for the Loved One's condition.
- Unlimited Mental Disorder/Substance Abuse Benefit to all occupations and specialties within the base contract. The Standard is one of only a few carriers to offer this benefit.
- Own Occ coverage in the base contract without requiring the Noncancelable Rider. Again, The Standard is one of the few carriers offering this.
- Lifetime presumptive benefits are now in the base contract instead of the Noncancelable Rider.
- Protector Platinum continues to have medical and legal specialty protection in the base contract, which is a unique benefit compared to most major carriers.
- Automatic Increase Benefit is included in the base contract.
Protector Platinum introduces new benefits that are unique in the industry.
Retirement Of Unpopular Features
To keep the product straightforward and simple, the product development team decided to remove some features that didn't appeal to target markets, such as separate policy fees, the 730-day waiting period and the Supplemental Social Insurance Rider.
Taking your feedback into consideration, pricing was adjusted on Protector Platinum while including new benefits and maintaining profitability. We learned from you that pricing has been perceived as too expensive for young female physicians and dentists.
We know some of our competitors have been making cheaper offers in the physician market, and the recent recession has also made pricing more of a focus. The Standard's goal is not to offer the cheapest product, but instead to offer the best value based on product, price and service. We want our policyholders to receive the best overall coverage for their money and not just the cheapest policy or highest benefit amount.
We hope that Protector Platinum will be attractive to all of your prospects. If you have typically sent some business to other carriers, we encourage you to consider if Protector Platinum might be a better fit for your current or future business.
The new features of Protector Platinum were created with the input and wisdom of The Standard's claims, legal, compliance, underwriting, sales and marketing, policy administration, guarantee issue, actuarial, and information technology experts. Each group helped balance all of the product needs. In some cases, additional risk management features are integrated in Protector Platinum without sacrificing competitiveness or marketability.
The Standard understands that its business revolves around people and not products. In order to build a sustainable business in the IDI market, we remain committed to long-term customer relationships.
We hope that Protector Platinum fits well with your business.