to Disability Insurance
insurance coverage is used to replace income in the event
of total or in some cases partial disability. The cause may
be accident or illness. The definition of "disability"
for the purposes of insurance would include the inability
to perform the duties of one's occupation.
insurance typically provides disability income benefits that
begin at the end of a specified waiting period and that continue
until the claimant returns to work, is deceased, or becomes
eligible for pension benefits.
in policies are the waiting or elimination periods and length
of coverage. A waiting period is the amount of time the claimant
must wait before benefits begin and is analagous to a deductable.
Typical waiting periods include 30 days, 3 months, 6 months
and 1 year. The length of coverage can vary from 2 years,
5 years, to age 65 or in some cases lifetime.
occupation, waiting period, coverage amounts and coverage
length all contribute to the determination of policy costs.
considering any insurance plan it is important to investigate
the insurance company. It makes sense that a company without
adequate reserves to pay claims should be avoided. As a minimum
standard consider selecting only insurance companies that
have at least one of the top 3 ratings for financial strength,
or claims paying ability.
company ratings including the ability to pay are available
are available from the following organizations:
Standard and Poors
A. M. Best
cancel existing coverage until you have verified that the
replacing policy has been issued. Always print/photocopy your
applications and any form bearing your signature. It is a
good practice to keep these copies for seven years after canceling
forms are frequently returned for lack of complete information.
Complete the forms thoroughly and if some question doesn't
apply write "Not Applicable". Make sure you know
what you are applying for by obtaining a complete written
and Premium Payments
policies are designed to replace income lost as a result of
injury so it is important to understand how benefits are paid
in terms of consistency, regularity and amount. For many of
us, a long waiting period or a missed payment can be a financial
hardship. Understand completely the insurance company procedures
in times of short and long term disability.
certain that the insurance company receives your premium on
time. Know what your grace period is. Coverage can be canceled
if premiums are not paid on time. It is possible reinstate
coverage if this occurs, but if you need it badly you will
most likely be denied.
for all options of paying your premium (monthly, Electronic
Funds Transfer, quarterly, semi, annual, and annual) in order
that you may evaluate your options carefully. Some payment
methods may allow you to obtain discounts (annual, EFT).