The Ark Group
Your Partner In Success!
Critical Insurance FAQ

Sales and Marketing
1)    Why is CI necessary?
It is the only product that properly protects the retirement portfolio during the wealth
       accumulation stage of life.

2)     Does CI pay if the insured has other insurance (i.e. health, DI or Cancer)?
Yes!  CI pays a benefit regardless of other insurance.

3)     Does CI replace the need for health?
No!  In fact, CI can’t/shouldn’t be applied for unless your prospect has health insurance.

4)     Does CI replace the need for DI?
Not exactly.  These products compliment each other but it depends on a prospect’s particular
       circumstance.  Call for more information.

5)     Does CI replace the need for Life?
No!  Life insurance (like CI, DI and Health) is too important not to have.  However, we feel CI does
       change the need for face.

6)     What is the difference between CI and Cancer Insurance?
Almost everything about CI is different than cancer coverage.
•  Tax free, lump sum vs. reimbursed medical expense
•  Net present money value vs. possible, unknown future payout
•  As a good friend at MET once said, “Why cover the bumper when you can cover the car?”
•  Call for more information

7)     What is the difference between CI and DI?
DI was developed to protect the paycheck; CI was developed to protect the retirement portfolio.
•  DI has occupation restrictions; CI really doesn’t
•  DI requires continued diagnosis documentation; CI doesn’t
•  Call for more information

8)     Who is buying CI?
There are only 3 occ’s that can’t qualify but all have a need forCI
Occupation:   Blue - $5K - $150K
      Grey - $75K - $225K
White:    $250K +
Age:       Male – 42 / Female - 38

9)     Is there a prospecting system for CI that works?
Yes!  It is important to point out that effective prospecting is more than mailers…you must
network in order to be successful!  Call for more information.

10)   Why should you sell CI?
Imagine a marketplace that is new (1st floor opportunity), you have no competition (yet),
projected to be a several billion dollar market and it is something new and imperative for your
clients.  Our question to you is “why wouldn’t you?”.

Product
1)     How does the product work?
CI pays a tax-free, lump sum amount of money upon diagnosis of a covered condition – whether
the policy holder survives or dies immediately following the diagnosis.  However, if the insured
should die from a condition or a reason that is not covered, all (100%) of premiums are returned
to the beneficiary…a true win/win product.

2)     How quickly do benefits get paid on this policy?
Benefits of a claim are usually paid out about two weeks after the claim is substantiated.

3)     How much face amount benefit does a person have available?
Premiums can range from a minimum of $5K to a maximum of over $1 Million.  Premiums vary
between these two amounts in $1K increments

4)     What happens to the policy and premium when a partial benefit gets paid?
This depends upon the insurance company but a majority of the time if a partial benefit is paid,
the remaining face amount will still be available for another diagnosis.  The premium usually
will decrease by the same percentage as the partial benefit percentage.

5)     How does ROP work?
There are two kinds of ROP
•  Returns all premium (minus any claim) upon death and is automatically included on the policy.
•  Returns all premium (minus any claim) at age 75 or in 30 years, whichever comes first.

6)     Are CI premiums guaranteed?
No.  There are no non-cancelable CI Policies currently available in the United States.  Premiums
can only increase by class and with Department of Insurance approval.

7)     Are CI policies guaranteed renewable?
Most CI polices are guaranteed renewable for life.  The exception to this is on certain simplified
issue policies which are guaranteed renewable until age 75.

8)     What is a survivorship cause?
It requires the insured to live a minimum of 30 days after diagnosis of a covered condition in order
to get the benefit face amount.  If the insured dies within those 30 days, the policy will refund
all premiums.

9)     How do waiting periods affect CI?
Waiting periods differ by state.  A waiting period begins once a policy is effective and can last up to
90 days from that date.  Not all conditions on the policies have waiting periods.  So, in the event of a
diagnosed condition during the waiting period, a small portion of the benefit amount or ROP will be
paid as the benefit.

10)   Aren’t all products basically the same?
No.  CI Policies fall under two different categories and differ tremendously.































11)   Are CI face amount benefits taxable?

Underwriting
1)     Can a prospect still qualify for CI if they have been previously diagnosed with a covered condition?
About 99.9% of the time, this answer is “no”.  However, some carriers have the ability to rider off
blindness and deafness.

2)     What are a few of the quirks with CI underwriting?
As follows:
•  Family history
•  Cholesterol
•  Previous diagnosis (regardless of amount of time since last diagnosis)
•  Height/weight
•  Polyps

3)     Why do some companies require an oral fluid test?
It is a less expensive way of finding out if an applicant has:

4)     What are a few of the advantages to CI underwriting?
As follows:
•  No occupation restriction (for the most part)
•  Back problems aren’t a problem
•  Controlled anxiety problems aren’t a problem
•  Some policies are simplified issue

5)     If a prospect is declined coverage for traditional, can they reapply with simple?
No.  However a client could be declined for simplified and then reapply with traditional.

6)     Are underwriters available for me to call with questions?
Yes.  However it is recommended that you try calling The Ark Group first.

7)     Are there financial underwriting requirements for CI?
Yes.  However they are no as stringent as DI
•  Generally 3 to 5 times gross income, plus mortgage balance
•  A stay at home spouse can qualify for up to the same amount of benefit as the working spouse.

8)     Does CI qualify under Section 125?
No/possibly.  Call for more information.

9)     Can an entity, individual or charity own the policy and be a qualified beneficiary?
Yes.  However there are guidelines here…call for more information.

10)   Does the agent need to be an underwriting expert?
No.  When in doubt, rate up 25% or call The Ark Group or an underwriter.

Simplified Issue
1)     What does simplified issue mean?
It means that the underwriting process is a yes or no application, on MIB check, non med and only
3-5% of the time are APS’ ordered.

2)     What are the underwriting requirements for simplified CI?
•  Yes/no application
•  Non med
•  MIB check
•  Rarely will and APS be ordered (3-5% of the time)

3)     What is the average turn around?
4-7 business days (If an application is complete and has no MIB hit, Assurity guarantees a 4
business day turnaround or $100!)

4)     Is the process for CI simple?
Yes, in fact you are not required to be in person when taking an app, the company an draft the first
month’s premium and the carrier doesn’t require an original application/signature.

5)     What are a few of the quirks to simplified CI?
•  Limited access to a client’s health information, a person may be declined whereas if they would
   apply for Traditional they may qualify
•  Amendments to be signed by client at delivery and returned to home office
•  Less coverage

6)     What are a few of the advantages to simplified CI?
•  Shorter application
•  Quicker underwriting turnaround
•  No rate ups – pass or fail underwriting

7)     Is there G.I. available?
Yes.  On group/association group business only

Traditional Issue
1)     What does traditional issue mean?
Traditional issue means fully underwritten.

2)     What are the underwriting requirements for traditional CI?
As follows:
•  Paramed (short form; except large face amounts require long form)
•  Labs (blood and urine)
•  Phone interview (not with all companies)
•  EKG (with large face amounts)
•  MD Exam (with large face amount)
•  MVR (with large face amounts)

3)     Can a previously completed paramed and labs be used in place of newly requested paramed and lab
       requirements?
Yes.  However, underwriters always have the discretion to ask for your client to redo the paramed
or labs.

4)     What is the average turnaround?
Average turn around time is approximately 21 business days.

5)     Is the process for traditional issue tough?
No

6)     What are a few of the quirks to traditional issue CI?
As follows:
•  Underwriting
•  Reinsurance

7)     What are a few of the advantages to traditional issue CI?
As follows:
•  Higher face amounts
•  An applicant who can’t qualify for simplified issues, may qualify for traditional
•  More insurance carriers to choose from


    Good
  • Pays a death benefit
  • Usually a quick issue
Life Chasis
    Bad
  • Premiums mainly calculated based on mortality
  • Benefit definitions are tougher to qualify for
  • Average American is lucky to own one life policy and they bought it for their beneficiary – if this is the only life policy a person has and we accelerate the benefit, what did we just do to the family?
  • Gimmick to sell more life insurance
  • Not the right thing to do
  • At the end of the term, premiums are guaranteed to increase
Health Chasis
    Good
  • Premium based on incidence rates
  • More lenient benefit definitions
  • Usually less expensive
  • Doesn’t take away from the life insurance benefits (diagnosis)
  • Premium can only increase by class basis and Department of Insurance must allow the increase

     Bad
  • Doesn’t pay a benefit for just any reason of death, however, this product wasn’t developed as “hang nail” insurance
  • Can be tougher in underwriting

FAQ

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