3 Keys to Recommending a Residual Rider

July 29, 2020
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Who needs a residual rider? Everyone

What if one of your clients becomes sick or injured and can’t work full time? Clients who can work only part time still need their full-time incomes. A residual disability benefit can help. 

How to Choose

The Standard’s Platinum Advantage offers three residual riders. The Short-Term Residual Disability Rider is available to most lower occupation classes. But most applicants choose between the Basic1 and Enhanced Residual Disability riders. 

Let’s looks at three important differences between the Basic and Enhanced riders.

1. Definition of Residual Disability

Qualifying for residual disability benefits centers on three potential losses:
•    Loss of time
•    Loss of duties 
•    Loss of income

Clients must show at least a 20% loss of income, plus either a 20% loss of time worked or 20% loss of duties, to meet the benefit waiting period requirement and qualify for benefits. 

Clients must show a 20% loss in only one category to be considered residually disabled during the benefit waiting period — 20% of duties or 20% of time worked or 20% of earnings. 

After the benefit waiting period, they must only show a 20% loss of income.

2. Minimum Benefit Guarantee

Clients will receive at least 50% of the monthly benefit for the first six months that benefits are payable. Clients will receive at least 50% of the monthly benefit for the first 12 months that benefits are payable.

3. Regular or Any Occupation Recovery Benefits

Clients can receive comprehensive recovery benefits. They must return to their previous occupations to be eligible for recovery benefits.

Clients can receive comprehensive recovery benefits. They can return to their previous occupation or another occupation to be eligible for recovery benefits.

Most clients will find the Basic Residual Disability Rider provides the strong residual coverage they’ll need — at a lower cost. The Enhanced Residual Disability Rider was designed for highly specialized professionals and those who may not experience a loss of income immediately after a disability, such as business owners. 

Talk to your clients about the key features of each residual rider to help them choose the one that’s right for them. Need a cheat sheet? See the 3 Residual Choices flyer for rider details.

1 The Basic Residual Disability Rider isn't available in California.

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