What does this picture have to do with a Non-Evidence Maximum?? Nothing, I just wanted to take a moment and say thank you to the incredible weekend we had.
Onto the Blog.
I will take a step back and explain what Evidence of Insurability is. This is Sun Life’s Definition; “A statement, or proof, of an employee’s or dependent’s medical history. It is used to determine whether or not coverage will be provided. In some cases, it may be required that you submit to a paramedical or other physical examination, at our expense, as part of the Evidence of Insurability. Also known as “proof of good health.”
The Non-Evidence Maximum (NEM) effects your Life, Critical Illness and Long Term Disability benefits. The Insurance Company will give your employees a certain amount of insurance without requesting any medical evidence. The Non-Evidence amounts are dependent upon how many employees you have participating in the Employee Benefit Plan. The more employees the easier it is for an Insurance Company to spread the risk, so they will provide more insurance without requesting proof of an employee’s medical history.
Sun Life calls it Guaranteed Issue; “The maximum amount of insurance coverage you may elect without answering medical questions (providing Evidence of Insurability)”.
As your company grows it is important for both the Insurance Company and especially your Broker to make sure that your NEM is always at the maximum amount that an Insurance Company will provide.
The other area that is important to know, is if an employee applies for the excess insurance by supplying their medical history and they are turned down, an employee will not be eligible for any future NEM increases with that Insurance Company. The only way you can get that employee to a new NEM would be to transfer Insurance Companies.
If you would like your Insurance Contract reviewed, please contact Glendinning Insurance Services, your Resource Specialist.