A person must be in good health to purchase disability income insurance. Regardless of occupation, age, sex, or income, if an individual's health does not meet Ohio National's underwriting standards, the policy will be modified, rated, or not issued. The Marketing Guide gives examples of ratings for overweight or blood pressure elevation. Ohio National requires that a complete and accurate medical history be submitted with the application.
In addition, depending on the age of the applicant and the level of benefits sought, additional medical requirements, such as a paramedical exam, blood profile, EKG, and/or personal history interview may be necessary. The medical/blood requirements are listed in the Marketing Guide and are also automatically determined on the DI proposal software. They are listed on the Premium/Underwriting page of the proposal output.
Smoker Status
It has been proven that people who do not smoke cigarettes have a lower frequency and severity of claims than people who do. This has a direct effect upon the cost of the policy. We structure our premiums in two categories: standard for those who smoke cigarettes, and discounted non-smoker for those who do not.
Issue State
Another factor that can affect policy cost is the issue state. Since claim experience varies from state to state, we use a geographic rate banding system for some of our products. This enables us to develop a flow of premium, which should result in a profitable block of business.
Ohio National uses four rate bands, ranging from ".9" for those with lower than expected experience, and "1.0" for those with expected experience, and "1.10" to "1.25" for the states with the least favorable claim experience.
Information concerning the classification of a particular state can be obtained from the Marketing Guide, page 35 or by calling FASTeam at 1-877-665-2468, option 3. The application should be signed and dated in the state where the insured either lives or works.
Ohio National is not affiliated with, nor does it endorse or sponsor, any particular prospecting, marketing or selling system.