Beginning a medical practice, or perhaps settling into a more stable period after establishing yourself as a physician, is exciting. There’s so much to do, and that includes getting the proper insurance to protect you and your family.
While gathering quotes for disability insurance, think about choosing a non-cancelable and guaranteed renewable policy feature. This is for your long-term protection. You don’t want to reliably pay policy premiums for years only to have your insurance company cancel the policy, change the language of the plan, or even increase premiums.
Disability insurance policies can be both non-cancelable and guaranteed renewable. If you pay your premiums on time, then your policy will not be canceled. Your policy provisions should also stay the same, along with the amount of your premium payments.
What Is a Non-Cancelable and Guaranteed Renewable Policy?
Non-cancelable means that the insurance company cannot raise the premiums on your policy as long as the premiums are paid.
Guaranteed Renewable means that the company cannot cancel your policy as long as you continue the premiums, and they cannot change the policy definitions and provisions.
Each insurance carrier will differ in how you could customize the policy. You will usually have the option of selecting both Non-Cancelable and Guaranteed Renewable or Guaranteed Renewable only. Selecting a Non-Cancelable and Guaranteed Renewable policy will result in slightly higher premiums compared to a Guaranteed Renewable only policy.
Benefits of a Non-Cancelable and Guaranteed Renewable Policy
The major benefit of why you should consider disability insurance that is Non-Cancelable and Guaranteed Renewable, is that everything is locked in!
- No changes to your premiums, unless you have graded premiums or you increase your monthly benefit in the future
- The total disability benefit will be payable, even if your income goes down
- No renewal process that recalculates premiums
- No renewal process that redetermines policy terms based on health changes
- The company cannot cancel your policy as long as you pay your premiums
Disability Insurers That Offer Non-Cancelable and Guaranteed Renewable Policies
Each company uses the terminology of “Non-Cancelable and Guaranteed Renewable.” However, they may have different options to choose from. Let’s look at each one separately:
Guardian
All individual long-term disability insurance policies from Guardian are non-cancelable and guaranteed renewable. You will not be able to customize this.
Ameritas
Ameritas offers a non-cancelable and guaranteed renewable plan where they cannot increase your premiums, cancel the policy, or change definitions or provisions.
You can also choose to have a Guaranteed Renewable only plan through Ameritas. By removing the Non-Cancelable, your premiums will be slightly lower but it will allow the company to have a right to change your premiums in the future, as long as it’s for a class or pool of policies. For example, if claims data suggests a large increase of claims from Pediatric specialties, Ameritas could increase the premiums after obtaining state approval for all new applicants as well as policies of Pediatric specialties that do not have Non-Cancelable. However, by having a Guaranteed Renewable only plan, they won’t be able to cancel the policy as long as you continue the premiums, nor would they be able to change the provisions and definitions of the policy.
Standard
Standard also offers a guaranteed renewable only policy or non-cancelable and guaranteed renewable. To add non-cancelable to your policy, you will need to make sure the “Noncancelable Policy Rider” is attached.
If you have the Guaranteed Renewable only feature, as long as you pay premiums on time, The Standard cannot change or cancel your policy or change any terms, except the premium. Premium rates may only be changed only after the policy is three years old and only if the change applies to all policies with similar benefits insuring the same risk class (occupation class, gender, and tobacco use).
Adding the Non-Cancelable Policy Rider will make the policy Non-Cancelable and Guaranteed Renewable. This means that the premiums cannot be changed in the future. Premiums will only increase for increases in benefits under the Benefit Increase Rider and/or the Automatic Increase Benefit Rider (if selected).
Principal
Principal’s disability insurance policy is non-cancelable and guaranteed renewable for all.
MassMutual
MassMutual policies will also be non-cancelable and guaranteed renewable until the policy’s anniversary.
Consider Your Options
Take into account the important features that guarantee your policy’s premiums cannot be increased, as long as you continue paying premiums. Talk to us to determine what policy specifies would offer you the most protection.