1 Business Overhead Expense If you are a business owner and become too sick or hurt, what impact would that have on your business? Who would pay your business overhead expenses? How could you keep your business open?

2 The Reality 30% of all people 35 to 65 will suffer a disability for at least 90 days and one in seven will be disabled for five years. * There is a disability caused by a motor vehicle crash every 30 seconds. ** The probability of at least one owner in a two-owner firm becoming disabled before reaching age 65 is 23%, if each is age 30. * Health Association of America; The New York Times, **National Safety Council Accident Facts, ***Based on recent disability insurance industry experience

Consider The Likelihood... Commissioner’s Individual Disability Table B - Equally Weighted 90 Day Elimination Period.

4 Ideal Candidates Medical Professionals Veterinarians Architects Smaller Law Firms Smaller CPA firms Hairdressers Photographers Tailors

5 Ideal Candidates Owner is the major revenue generator Business has less than 10 employees Been in same location two years or more

6 Examples of Covered Expenses Lease or mortgage payments Utilities Employee salaries and benefits Payments for leasing or purchasing furniture and equipment Accounting, billing, and collection fees Janitorial, security, and maintenance Premiums for malpractice, property, liability insurance Professional trade dues and subscriptions

7 Expenses that are NOT covered Salary and Benefits for: The insured Any person sharing business expenses with the insured Any member of the insured's profession *Any individual hired to perform the insured’s duties * Any person responsible for the generation of income for the business Any member of the insured’s immediate family, who was not a full-time employee prior to disability.

8 Other Expenses that are NOT covered Expenses that are passed along to the consumer (Lab Fees, Medical Supplies, etc.) Professional Tools or Wares Travel and Entertainment Costs of Goods Additions to Inventory Any Expense the Insured did not have prior to the disability*

9 Elimination and Benefit Periods Available Waiting Periods: 30, 60, or 90 days ( 0 days for presumptive disabilities, some carriers) Benefit periods: 12, 18, and 24 months

10 Optional Riders Replacement Expense Rider Residual Disability Rider Future Insurability Option Income Protection

11 Issue and Participation Limits White Collar : Max issue $30,000 per month Top Occ Classes Limits per Occ Class will vary, i.e. 3A-Issue $15k /Participate $20 Blue Collar: Issue $10,000/ Participate $12,000 per month Top Classes only Limits per Occ Class will vary, i.e. 3A-Issue $9k, 2A-$7,000 per month May not offer to all classes or occupations

12 Business Overhead Expense Underwriting Financial: Most Recent Business Tax Returns, all schedules. (Two Full Years Preferred) Medical: Telephone Interview (all amounts and ages), Blood/Urine, Para Med, EKG (by amount, age, and state)

13 Other BOE Features can have True Own Occupation Definition Non Cancelable Contracts Covers expenses for up to two years Conversion Options Available Premiums waived during disability Premiums are Tax Deductible Discounts for Three or More Partners

14 Sales Opportunity? There are more than 6.6 million companies in the United States. More than 50% are small businesses. 68% have no DI coverage at all!