Should You Compare Disability Insurance Based on Price?
Aug 14, 2014
Jamie Fleischner

Jamie Fleischner

14 Aug, 2014

When comparing individual disability insurance policies, should you compare the policies based on price?

The simple answer is yes. Price always matters, especially if there is a significant difference among policies.

Individual disability insurance policies have subtle differences between policies which make it difficult to compare policies precisely. If the premium is within  3-5%  of each other, it makes sense to look at these subtle differences to determine the best fit.

Companies tend to make price shifts based on their claims experiences. For example, some companies will drop their rates significantly and accumulate a lot of new policies on the books.  Some companies try to price themselves out of the marketplace in certain occupations such as physicians and dentists.

Some companies shift their rates for some medical specialties after re-evaluating their claims history.

It is important to note that if someone is telling you not to compare based on price and to go with the most expensive policy, take a closer look to see if that agent or broker has an affiliation or are employed by that insurance company. Chances are they have a financial incentive to sell that particular company even if it is more expensive or not the most suitable for your needs.

As a consumer, the best route is to work with an independent broker with no affiliations to any particular company. This way you will receive the most objective advice to find the best policy at the best price for your needs.

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