Stumped by the Disability Insurance Underwriting Process?

Don’t let insurance terminology get in the way of protecting your income into the future

By Alex D. Spiller, CFP®

If the thought of the application process to obtain insurance is holding you back from making this critical investment in your financial future, we have good news. All those fancy terms, including the word ‘underwriting’ should not deter you from protecting your greatest asset: your ability to earn an income. If you’re a dental student, you are in a particularly good position to pick up an affordable policy and lock in any potential discounts while you’re in school. Here are a few of the most common questions we encounter when it comes to the process of obtaining disability income insurance…

What is underwriting, anyway?

Underwriting is the process through which an insurer will assess the risk of insuring you. It includes getting information about you, your health history, and your professional responsibilities, so that the insurer can determine if they would like to insure you and for how much.

Will I need to submit ‘labs’?

Many applicants do not need to submit any kind of labs. It’s up to the insurer, obviously, to request them if they see reason to. More than ninety percent of student/resident applicants we see can secure disability income insurance without any routine   lab requirements. Depending on your health history, you may be asked to complete bloodwork. If requested, bloodwork is done at your convenience and the insurance company’s expense.

How long does it take to get an approval from underwriting?

If your health history is clear, and there are no other issues, we have seen approvals come through in a week. On the other hand, if the insurer requests your medical records, that could slow down the process.

I keep hearing that students can get a discount, how does that work?

Indeed, you may be able to buy yourself a solid ‘starter’ DI policy for the equivalent of a few lattes at your favorite coffeeshop. Basic as it may be, that policy could provide a foundation for further enhancements as your income grows.

What about an interview – will I need to speak with a live person about this?

A quick conversation with a financial advisor is helpful to answer any questions you may have, and for your advisor to get a sense for what features would be suitable in a policy. You would get a chance to talk about affordability and discuss riders that you may want to add to the policy for future insurability and/or future benefit increases.

What if my health status changes?

The best part about securing disability income insurance while you are younger and presumably healthier, is that even if your health declines, you have locked in a policy and can continue to be protected.   Many companies offer a feature that allows you to increase your coverage in the future without regards to any changes in your health.

Can’t I just buy this online?

Disability income involves protecting your ability to earn an income, which factors in your income and your health – two very important parts of your life. Most insurance companies have significantly simplified the application process.

Regardless of what insurer you choose, you cannot buy disability insurance directly from an insurance company, you need to work with an agent. Given that’s the case, we cannot emphasize enough the importance of working with an agent who is familiar with the dental market space.

An educated representative of a reputable company will be a helpful guide to you in in this process.

What is the underwriting process, step by step?

Every company will be different, but this may give you a good sense for the timeline:

1. Speak with an advisor to ask any remaining questions you may have about DI.
2. If you choose to move forward, the advisor will collect some personal information from you (name, contact info, that kind of thing), along with your graduation date if you’re in school.
3. The insurance company will email you a link to complete a health questionnaire at your convenience
4. An underwriter reviews your information and may reach out for more should there be any questions about your health history that may impact the application
5. Assuming there are no issues, the underwriter comes back with an approval
6. The policy is issued, and you can sign for it electronically
7. Payment can be set electronically to debit from a checking account

And that’s pretty much it! Disability income insurance is one of the most important financial protections anyone, but especially dentists, can have in place. Obtaining it is never easier or more affordable than when you are in school. Take advantage of student discounts and of your good health and lock in your income protection while you can.

Treloar & Heisel, an EPIC Company, is a financial services provider to dental and medical professionals across the country. Our insurance and wealth management divisions assist thousands of clients from residency through retirement. We strive to deliver the highest level of service with custom-tailored advice and a strong national network.

Alex D. Spiller is regional director of Treloar & Heisel, Inc., AR Insurance Lic. # 17459113. He can be reached at aspiller@treloaronline.com.

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