Today I had the opportunity to work with an orthopedic surgery resident who contacted me after talking to several agents from other companies. He was overloaded with information and needed help making sense of it all.
As an independent insurance broker, I was able to distill the information from the various companies and offer explanations about the differences from each company.
It became apparent that when he talked to an agent of a company, they had a lot of knowledge of one company and the policy advantages, but they were not able to provide accurate comparisons of other companies.
Agents of a company are employed by a company and have strong incentives to write business with the company by whom they are employed. This is helpful if the company they are representing match your needs. However, there is not one company that can fit the needs of every client. The information they provided about the other companies was actually not even accurate. They provided information about their competing companies that was categorically untrue.
An insurance broker is an independent professional that does not work for one company. They work on behalf of the client and represent multiple companies. Oftentimes this allows them to be objective since there is no incentive to place business with any particular company. This also requires insurance brokers to have a lot of knowledge of multiple policies and to keep up with tall of the industry changes.
As it turns out, this orthopedic surgeon needed more than one company. He was in his last year of training as an orthopedic surgery fellow specializing in foot and ankle surgery. He already had several contract offers that would pay him more than $400,000 a year of income without any group disability insurance benefits. If he chose to purchase a policy with only one company, he would be limited to $15k or $17k of benefit (depending on the company) in the first year out of residency. If he wanted more benefits, he would need to apply with another company. This would require new medical underwriting.
We determined there were benefits and drawbacks from the various policies we reviewed and decided to blend benefits from more than one company to optimize his current and future benefits.
When shopping for an individual disability insurance policy, it is important to ask your professional if they are an agent or a broker and how they can help you now and in the future.