Lloyd’s GID
Lloyds, London is the world’s leading specialist insurance market. As an approved Lloyd’s coverholder since 2003, Hunter McCorquodale has developed a suite of proprietary DI products supported by the leading Lloyd’s syndicates in this class.
Through our Lloyd’s facility we are able to provide GID (Guaranteed Issue Disability) income replacement solutions, generally with significantly higher monthly benefits with fewer insured lives than other GID providers in the market. We can do this on a stand-alone basis or as a supplement (top-up) to an existing GID program with another insurer, where higher limits are needed.
We can provide GID solutions not only for income replacement, but also for our Lloyd’s business DI solutions such as Key Person DI and Buy/Sell DI.
GID programs are most effective when coverage is mandatory for all eligible participants. However, optional GID programs can also be considered.
| FEATURE | DETAILS |
|---|---|
| Amounts: | Subject to the appropriate justification of sum insured. Benefit amounts are based on $500 per life per month to a maximum of $50,000 (or up to 85% of after-tax income.)The same parameters will apply to the GID program, with the exception that policies issued under a GID program are generally limited to a maximum policy term of 3 years. |
| Coverage Types: | Income Replacement, Buy Sell, Key Person, Business Overhead Expense |
| Issue Ages: | Age 20 up to 70 years old |
| Currencies: | Canadian or US dollars |
| Policy Terms: | Up to 3 years. Coverage is usually adjusted annually to reflect changes in covered earnings. |
| Elimination Periods: | 30, 60, 90, 120, 180 days |
| Monthly Benefit Periods: | Up to 60 months of monthly benefit plus present value of payment to age 65. |
| Participation Limit: | Minimum of 10 lives for mandatory program. Voluntary programs are determined on a case-by-case basis depending on the number of eligible participants, ages, occupations and other considerations. |
| Premiums: | Mandatory program premiums are age rated or structured on a level basis (same cost for all participants regardless of age). |
| Enrolment: | Answers on the enrolment form determines if the proposed insured person will be automatically covered or not. |
Sample Cases:
Law Firm
A large law firm had group LTD with a $16,000/month non-taxable limit and implemented a GID program with a regular insurer providing an additional benefit of up to $10,000/month non-taxable for partners. There were several dozen partners that still had a need for substantial amounts of additional coverage.
We implemented a GID program providing a non-taxable monthly benefit of up to $24,000/month, bringing total coverage for the most senior partners to a total of $50,000/month non-taxable.
Asset Management Firm
An asset management firm was looking to implement a GID income replacement program for their 30 top executives to supplement their group LTD coverage which had a non-evidence maximum of $12,000/month taxable and an overall maximum of $20,000/month. They had an offer of $3,500/month maximum GID from a regular insurer but they needed a much higher limit.
Instead, we implemented a Lloyd’s GID program through us with a maximum monthly benefit of $15,000/month.
The first step in the process is to work together with us and your client to design an appropriate program that meets your client’s needs. We will then provide an offer letter outlining the details of the program, to be signed by the client. We will also provide a customized enrolment form for distribution to all eligible participants, who must return the completed form within a specified period of time.
There are usually two or three questions on the enrolment form. If all questions are answered “no” then the participant is automatically covered in accordance with the terms of the offer letter. However, if any of the questions is answered “yes” we reserve the right to obtain additional underwriting requirements and to modify the terms of coverage offered or to decline coverage under the program.
Individuals that become eligible for coverage under the program after inception, whether because they are new to the enterprise or are promoted into an employment category that is covered under the program, must complete an enrolment form within a specified period of time in order to be added to the program.
Coverage is usually adjusted annually to reflect changes in covered earnings, and the entire program is reviewed and adjusted periodically as necessary to ensure it continues to meet the needs of the enterprise and the covered participants.