Group Disability Income

Product

Your group disability income benefit pays a monthly income benefit if you become disabled. A group disability policy is typically issued to the plan sponsor which can be your employer, union or other association.

Assuris Protection

If the life insurance company holding your group disability policy fails, and you are not receiving payments at the date of failure, Assuris will ensure that the coverage under your group disability income policy will continue until the earlier of:

  • The next renewal date for your group contract, or
  • Six months from the date of failure of the life insurance company

It is anticipated that the plan sponsor or the liquidator will transfer the group disability policy at the renewal date or within six months to another member life insurance company.

If you are receiving monthly payments at the date of failure, Assuris will seek to transfer your policy to a solvent company where you will continue to receive your monthly payments.

Assuris guarantees that you will retain at least 85% of your monthly income benefit. For policies that have a monthly income benefit of $2,000 or less, you will retain the full amount of your benefit.

Example 1

Monthly Income

$1,500
/month
Original Benefit Amount

In calculating your Assuris protection, you will retain up to $2,000 or 85% of your monthly income benefit, whichever is higher.

Since the amount is less than $2,000, your monthly income benefit is fully protected.

$1,500
/month
Adjusted Benefit

Example 2

Monthly Income

$3,000
/month
Original Benefit Amount

In calculating your Assuris protection, you will retain up to $2,000 or 85% of your monthly income benefit, whichever is higher.

Since the amount is more than $2,000, the 85% protection is applied to your monthly income benefit.

$2,550
/month
(3,000 × 85%)
Adjusted Benefit

The liquidator, appointed to manage the failed company, will seek to sell the assets and transfer the liabilities with the aim to get the best value for policyholders. This will determine the recovery percentage.

Your benefits will be adjusted to the greater of the Assuris protection or the recovery percentage achieved by the liquidator.

For example, if your monthly income benefit is greater than $2,000 a month and the liquidator recovers 90% of the assets, your policy will be adjusted to 90% instead of Assuris’ guarantee of 85%.

Original Benefit Amount

Monthly Income Benefit $4,000

Recovery

Liquidator Recovery:
$3,600
($4,000 × 90%)

Assuris Protection:
$3,400
($4,000 × 85%)

Explanation

Since the liquidator’s recovery is greater than Assuris’ protection, you will retain $3,600 a month.

Questions and Answers

1. What if you have separate group benefits with the same insurance company through different plan sponsors?

Assuris provides separate protection for each group plan sponsor.

2. What happens if you have a group policy and an individual policy with the same company?

Assuris provides separate protection for group policies and individual policies. If you are a member of a group insurance policy and you also have an individual policy with the same life insurance company, Assuris’ protection applies to each policy separately.

3. What happens if you have increasing disability benefits?

If your disability benefits increase under the terms of the policy, for example by inflation adjustments, it will be protected based on the monthly income at the date of failure of your life insurance company. After the date of failure, your monthly income will increase based on the protected amount.

4. What happens if you receive quarterly, semi-annual or annual benefit payments?

For quarterly benefit payments the Assuris protection is $6,000/quarterly or at least 85% of the promised quarterly payments, whichever is higher.

For annual benefit payments the Assuris protection is $24,000/annually or at least 85% of the promised annual payments, whichever is higher.