Waivers for Impairments***Impairment Riders

• The policy names a condition the insured has and excludes coverage due to that condition.

MR. WATSON: Guys, at one point in time I spent a little over a year selling nothing but disability income insurance, high end.

MR. WATSON: There was an orthopedic surgeon I went to see. He was living near the University of South Florida. I was at his house, talking to his wife. When he came down the hall, you could hear him coming down. He was a big man, biggest man I have ever seen. He was a power lifter. He also had a detached retina. He had blown it out lifting weights.

MR. WATSON: They issued him the policy standard. Standard.

MR. WATSON: Own occupation, residual disability policy. Standard, but with a waiver. They said, "If anything should happen to your eyes, if you should become disabled with anything regarding your left eye or your right eye, we're not paying." Make sense? That's because the impairment was there before he bought the policy. What if it got worse and he couldn't work? Would it cover it?

MAN: No way. But it would cover him for everything else.

MR. WATSON: That's called a waiver for impairment.

 

Renewability Provisions

MR. WATSON: Renewability provisions, we did them already. The acronym was C.O.N.G., and the "C" stood for "cancellable policies." Remember that? The "O" stood for "optionally renewable." The "N" for "non-cancellable." Guys, can they cancel a noncancellable policy? Of course not. The "G" stood for "guaranteed renewable."

MR. WATSON: Disability Income policies are non-cancellable. Can they raise the premiums on a noncancellable policy?

ALL: No.

MR. WATSON: What's the first two letters of noncancellable? N-O. Can they raise the premiums?

ALL: No.

MR. WATSON: With a guaranteed renewable, can they raise the premiums?

ALL: Yes.

MR. WATSON: But only by -

ALL: Class.

MR. WATSON: We are done with this chapter. Know it inside & out!