Guardian Disability Insurance for Executives
Reverse Discrimination for the Highly Compensated
Four major problems exist for every highly compensated executive regarding the Group LTD they rely on to protect their income.
- The monthly benefit is capped (usually $10,000 per month)
- If the employer pays for it, benefits are received taxable as income during the claim.
- Bonus, Commissions, and Incentive Compensation may not be included.
- If you leave your job, you lose your coverage. Group LTD is not portable.
How To Make Up The Difference with Supplemental Disability Insurance
The higher your overall income is, the worse the reverse discrimination will be for you. If you make $150,000 a year, and your Group LTD has a maximum of $5,000 per/month, you will only collect $5,000 monthly during your claim. You will also have to pay taxes on that $5,000 per month! If you make $500,000 a year, you will still only collect 5 or 10,000 per month during a claim. So, the higher your income is, the lower your percentage replacement of income during a claim is. Nobody making $500,000 a year is getting anywhere near the 60% income replacement you may have thought you have in your Group LTD plan at work.
Guardian offers you the ability to purchase a personally owned supplemental disability insurance policy to help increase your overall income replacement percentage during sickness or injury. Depending on your income, you could get up to an additional $30,000 a month in protection (in addition to benefits received from the Group LTD).