How does an insurance claim work? Recently, I bought a pair of running shoes. I got to pick the colour, the style, and the fit that I wanted. When I took them out of the box and put them on, I felt justified in my purchase. I could feel that these new shoes were comfortable, they wouldn’t hurt my feet when I ran. Wearing them made me feel good. When someone is buying insurance it is hard to replicate those same emotions. There’s no instant, tangible reward.
Let’s use Disability Insurance as an example. With it, you are buying peace of mind, something intangible, something you hope you will never have to use. As an advisor, clients put their trust in you and based on recommendations, have the confidence that, should something happen to them, they will be okay. In our previous blogs we talked about Disability Insurance, why someone needs it, how it works.
This blog will address a claim in action and the impact it had on one of our clients. The client in this case was adamant that I share her story to make sure others know about the absolute importance of having disability insurance.
I remember it like it was yesterday. I was sitting at my desk when I got a text from a good client of mine. The text said, “Dave, I need to meet with you right away, this cannot wait, when are you free?”. I messaged back asking the client if everything was okay, the client said, “I will tell you everything when I see you, please bring my disability policy”. My heart dropped. The client was in her mid-40s, extremely healthy and worked out on a daily basis. It was only two and a half years prior that she was in my office debating whether she needed disability insurance. “I don’t have any health issues; I don’t expect to ever use this” she said. My response was a common one, “Your income drives everything, without it everything stops. The best thing that can happen is, at retirement, you no longer need this policy and never had to use it. What you are buying today is peace of mind”.
Now, here we were just a short term later and the intangible peace of mind she had purchased had just become a lifeline. “I have cancer. I got diagnosed two days ago. I go for surgery next week and start chemotherapy shortly after.” She went on to discuss how worried she was about her finances and not being able to work and said, “We planned for that, right Dave?”. “Yes,” I answered, “we did.”
The Claim Process
I often get asked about the claim process when it comes to insurance. How easy is it? Do I have to jump through hoops? Will they try to decline my claim? This is where the upfront work is so important. With the right policy and the completion of the underwriting process, it is quite clear what to expect at claim time. We submitted the claim on the client above and it was approved in three weeks. For those who are curious, here are the steps involved in submitting a claim from start to finish:
- Individual Disability Claim Form – The advisor would complete this with a client outlining the reason and details for the claim.
- Attending Physician’s Statement – This is sent to the client’s doctor and filled out to address the diagnosis and confirm that, from the doctor’s standpoint, the client is unable to work.
- Claims Coordinator – The client is assigned a claims coordinator whom they can contact at any time via email or phone regarding questions around their claim.
Let’s break down how this worked for my client and the role of each party involved:
The Insurance Company
In the case of our claim the client had a 90 day wait for benefits. This meant that, for the first 3 months, the client would not receive a monthly benefit and, on day 120, they would. In this particular situation the insurance company knew the client would be off work for a considerable amount of time based on the doctor’s notes and issued her the first claim check within 30 days of her claim. The insurance company would respond to the client and myself on the same day with any claims questions we had.
The client was facing one of the biggest battles of her life. One comment she made to me was about the absence of any financial stress on her and her family. The claim process was quick, simple and impactful.
I will start by saying what a privilege it is to be able to help people each day. Insurance is not a fun or exciting topic, but when it is needed, I cannot stress enough the emotional impact it can have. When we recommend and implement solutions for the client, we hope to never get the call I did. That is the part of the value proposition. When you need me most, I will be there for you and, no matter what life brings, I can confidently say “We planned for this.”
At Tall Oak Private Wealth, we are committed to ensuring you have the best protection in place and will be there for you every step of the way. Feel free to reach out to us to discuss your plan today by clicking here.
This material is provided for general information and is subject to change without notice. Although every effort has been made to compile this material from reliable sources; no warranty can be made as to its accuracy or completeness, and we assume no responsibility for any reliance upon it. Before acting on any of the above, please contact Tall Oak Private Wealth of Raymond James Ltd., for individual financial advice based on your personal circumstances. Raymond James Ltd. – Member – Canadian Investor Protection Fund. Insurance offered through Raymond James Financial Planning Ltd., not a member – Canadian Investor Protection Fund.