Principal: Important Upcoming DI Product Updates

11-11-2020

Principal regularly reviews their product portfolio to ensure their offerings continue to meet the objectives of their policy owners, distributors, and company. After a purposeful and thorough analysis, Principal will be introducing some changes to the Principal Individual Disability Income (DI) insurance product (HH750).

Effective January 1, 2021, the following updates will be implemented:

  • Gender-specific rates will be used for fully underwritten multi-life cases for healthcare-related occupations. This includes physicians, dentists, veterinarians, optometrists, and all other healthcare-related occupations listed as “A-M” or medical-related in the Occupational Class schedule of the Product Description & Underwriting Guide (login required). This guide will be updated to reflect the Jan. 1 changes.

    • Any insureds added to existing multi-life cases will be added at gender-specific rates.

    • Guaranteed Standard Issue (GSI) cases will continue to be based on gender-neutral (unisex) rates, except for Resident GSI/fallback cases, which will be issued on a gender-specific basis.

    • Applies to new policies issued after Jan. 1, 2021. See transition guidelines for details.

  • The Mental/Nervous & Substance Abuse Disorders Limitation Rider will be required for any new case where New York is the written or resident state—or where the insured’s occupation is “pharmacist.”
    • The Mental/Nervous & Substance Abuse Disorder Limitation Rider requirements for other states and occupations remain unchanged.
  • Select professional limits will be increased for graduating residents in 2021.
    • Limit for all M.D. and D.O. physicians and doctor specialists, except psychiatrists and podiatrists, increases from $6,500 to $7,500.
    • Limit for general dentists increases from $5,000 to $6,000.
  • Routine APS guidelines in New York will be expanded to include all applications, except those written under the Simplified Underwriting sales program.
  • New Select Occupation discount* of 10% will be available for the following:

        

Non-medical occupations:

 

 

  • Actuary
  • Attorney
  • Certified Public Accountant (CPA)
  • Corporate executive with income of $100,000+
  • Data scientist with PhD
  • Economist with PhD
  • Engineer
  • Scientist with PhD

 

Medical occupations:

 

 

  • Pediatrician
  • OB-GYN

 

 

Making these product updates will help us more sharply focus on our target markets and better align our product with others in the market—while continuing to provide you with an attractive solution to help your clients protect their income. This Disability Income (DI) insurance product premium discounts summary  provides an overview of discounts that will be in effect on Jan. 1, 2021.

Transition guidelines

Principal appreciates your business and recognizes these changes could impact cases you’re currently working on. To provide you with ample opportunity to get your business closed under the sales assumptions used when presented, the following guidelines will be in effect:

  • To get a policy issued with 2020 pricing and guidelines (pre-Jan. 1, 2021 changes), an application must be signed by Dec. 31, 2020 and received in the home office by Jan. 31, 2021.
    • Applications in underwriting—or issued but not in-force as of Jan. 1, 2021—can be considered to get the pre-Jan. 1 pricing and guidelines.
    • Policies in-force as of Jan. 1, will not be considered for re-issue.
  • The Principal DI illustration system will reflect new pricing effective Jan. 1, 2021.

Please give us a call at 1-800-792-6795 with any questions, illustration requests, or assistance with applications.