A Holistic Disability Insurance Plan for Each Client

August 14, 2019

Are your clients trying to use long term disability insurance to do it all? Help them take a broader approach. Design a holistic disability plan that combines LTD and Guaranteed Standard Issue Individual Disability Insurance.

LTD and GSI in tandem can result in strong coverage for all employees at the right price point and benefit level. 

A One-Size-Fits-All Approach Doesn’t Work

Most companies have a wide range of incomes to cover. A one-size-fits all approach can result in a coverage shortfall for top earners or unnecessarily high rates for lower earners. 

A typical LTD plan has a monthly benefit maximum of anywhere from $7,500 to 15,000. This can leave some high earners without the coverage they need if they make a claim. In response, some groups try to increase benefit maximums to ensure enough coverage for their high earners. But this strategy affects the premium rates for the entire group and can result in an expensive LTD plan. 

Additionally, carriers typically issue LTD plans with a rate guarantee for two or three years. The rate is re-evaluated by the carrier at the end of the period. A group with many high earners may make a lot of large claims. Depending on the case size, higher-than-average claims activity could result in an unexpected rate increase.  

Balance LTD and GSI for a Customized Solution

Make sure premium rates stay stable for your clients by suggesting an LTD plan that adequately covers most employees. Then add GSI to cover high earners and expand coverage to replace lost bonus and commission income not typically covered by LTD plans.

Adding GSI allows you to shift benefit dollars — or volume — off the LTD plan. You’ll protect your clients from unexpected LTD rate hikes and help them lock in GSI noncancelable premium rates that won’t change over the life of the plan.

Determining Who Needs GSI — A Tiered Approach

Companies often create tiers or classes to tailor coverage for each employee. Some tier ideas:

  • LTD and GSI for executive or director-level employees, while offering only LTD to the rest.
  • LTD and GSI for employees with bonus income; only LTD for salaried employees.
  • Law firm: LTD and GSI for partners and only LTD for associates.

The LTD-GSI Combo From The Standard

Your clients will appreciate a holistic disability insurance solution designed for their unique employee groups. By offering right-sized protection for each group at appropriate and stable rates, you’ll demonstrate your disability insurance expertise to your clients.

Stick with The Standard for both LTD and GSI and your client can receive a larger GSI discount. And if an employee makes a claim, they’ll work with only one claims expert from The Standard for both LTD and GSI.

Here are two tools to help illustrate the value of GSI to your clients: our Why GSI Matters Flyer and Platinum Advantage GSI Brochure. If you’d like help designing disability insurance plans for your clients, please contact your GSI sales representative.

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