As a Disability Insurance agent, I often hear from clients that they feel overwhelmed with all of the considerations one must take into account when purchasing a Disability Insurance policy. There are several things to take into account, but I believe that these are the top 5 distinct considerations to watch for when purchasing a Disability Insurance Policy.
Purchasing something new can definitely be overwhelming at times, but it is my hope that with this blog I can outline and clarify with ease the top 5 things you need to consider when purchasing a Disability Insurance policy.
1. Where Should You Purchase Disability Insurance?
– You can purchase Disability Insurance through your job, but these policies are often riddled with exclusions and limitations and don’t work in complete favor for the individual. Many times you need to purchase a Supplemental Disability Insurance policy as well in order to be completely covered in your time of need (when you are disabled and can’t work).
-You can purchase Disability Insurance through an agent. There are agents who specialize in this kind of insurance so they can customize a policy that will benefit and cover you when you really need it. By doing this, you will not need to purchase a Supplemental Disability Insurance policy.
2. Make Sure You Understand the Definitions of the Terminology Used
– When you purchase a policy it is essentially a contract. Any contract will have special terms that may mean very specific things. In this case, it is extremely important to understand what your specific policy considers a disability and what it does not.
-Pay special attention to how their definition of disability relates to your specific occupation AND if there are any specific mentions of being “partially disabled” and what that means for you.
3. Zoom In On What They Will Cover, What They Won’t, and For How Long
-An insurance company may tell you that they will not cover certain things like, substance abuse or a mental illness. Take note of what they will cover and what they will not. This is very important considering you have no idea what you will experience. Disabilities can come in the form of broken legs, severe depression, or an addiction, etc.
-Consider how long an insurance company will pay you benefits when you aren’t working and earning an income. Some may say 1 or 2 years.
4. How Long Do You Have To Wait Until They Will Start Paying You Benefits
-Many don’t know that you have to wait a certain amount of time before the insurance company will start paying you benefits. This waiting time is called the Elimination Period.
-One company may make you wait 90 days while another may make you wait 180. It varies. The shorter the elimination period, the faster you get your benefits while you are not earning an income.
5. Pay Attention To The Options Your Are Given
-Policies may offer you some options. This may include an option to increase your coverage in the future or an option for your policy to keep up with the pace of inflation. These options are things you choose or opt for when you initially purchase the policy.
The Bottom Line
There you have it, the top 5 things I feel you need to especially consider when you purchase a Disability Insurance policy. I hope that I have laid them out in a way that is easy to understand.
This policy is for you and your financial protection for the future. So it is in your best interest to ask plenty of questions to the agent or your employer of any terms or conditions you do not understand. Read the policy in its entirety as long as it may be.
Our agents at Insure Your Future specialize in Disability Insurance. We know how important it is to know exactly what you are investing your money in and can help you understand your entire policy. To get the process started, call us at (800) 788-8921 or fill out our Contact Form.