| If you and your loved ones depend on your | | | | of disability. |
| salary for support, then you probably need | | | | |
| long term disability income insurance. | | | | The waiting period is often called the |
| | | | elimination period. Choices usually range |
| Think about it: if you were to become | | | | from 30 days to 720 days. |
| disabled, even for a few months, how would | | | | |
| you and your family manage? Who would pay | | | | Look for a waiver of premium provision. This |
| your bills? Disabling illness or injury is | | | | means if you become disabled, you will not |
| one of the leading causes of bankruptcy in | | | | have to keep paying for your disability |
| the United States. | | | | policy. |
| | | | |
| Most people do not realize that their chances | | | | What are the conditions for renewing the |
| of becoming disabled are greater than their | | | | policy? If you're policy is not automatically |
| chances of dying prematurely. Yet they are | | | | renewable, the insurance company has the |
| more likely to buy life insurance than | | | | right to cancel it. |
| disability insurance. For this reason, people | | | | |
| in the insurance industry call disability | | | | Payment period options are another |
| "the forgotten risk.' According to statistics | | | | consideration. Some policies will only pay |
| from the Journal of the American Society of | | | | for a certain period of time, sometimes for |
| Chartered Life Underwriters, if you are age | | | | only two years. Other policies last a |
| thirty to fifty-five, your chances of | | | | lifetime. The most popular policies pay |
| becoming disabled are two to three times | | | | benefits until you reach retirement age, when |
| greater than your chances of dying. | | | | you can begin to collect Social Security |
| | | | payments. |
| If you are thirty-five years old, you have a | | | | |
| 50:50 chance of experiencing a disability | | | | Most policies have a residual disability |
| lasting last three months or longer before | | | | clause. If you suffer a disability, very |
| you retire. One in seven workers will become | | | | often you will return to work part-time at |
| disabled for more than five years before he | | | | first. Or because you were off work for a |
| or she reaches age 65. | | | | while, it may take you time to build your |
| | | | business back to the level it was before you |
| Many people mistakenly believe that the | | | | became disabled. Your insurance should |
| government or Worker's Compensation will pay | | | | provide income for both these scenarios. |
| them an income if they become disabled. | | | | |
| Actually, more than 80% of the people who | | | | Check over the policy for a recurrent |
| apply for Social Security disability benefits | | | | disabilities benefit. A recurrent disability |
| are rejected. Social Security does not pay | | | | is one that happens after you recover from |
| benefits for partial or short-term | | | | your original disability. Your insurance |
| disability. Your disability has to either | | | | should waive a new waiting period and/or not |
| last a year or be expected to last a year | | | | require proof that the two disabilities were |
| before you can collect Social Security. | | | | related. |
| Worker's Compensation pays only if you were | | | | |
| injured on the job and benefits are often | | | | When you buy disability insurance, you buy it |
| limited to a few years. | | | | according to your income level. The more |
| | | | money you make, the larger the benefit of |
| Your health insurance will cover your | | | | your policy. But you also have to figure that |
| hospital, doctor and other medical bills, but | | | | your income will rise as you get older. For |
| you will still not have a salary. Long-term | | | | this reason you want a future increase rider |
| care insurance only covers bills from nursing | | | | or automatic increase rider. These riders |
| homes or assisted care center. Disability | | | | allow you to keep your policy but increase |
| insurance, however, does not pay bills. | | | | the amount of your benefits based on your |
| Instead the insurance company gives you money | | | | increased earnings as you grow older. |
| on a regular basis. It is designed to replace | | | | |
| your salary so that you and your family will | | | | When you buy your insurance, certain factors |
| not experience financial hardship during any | | | | will affect your price. You will pay less for |
| period when you are too sick or injured to | | | | the insurance if you decide to replace 50% of |
| work. | | | | your income instead of 80%. You also pay less |
| | | | if you opt for a longer elimination period. |
| What should you look for when you are buying | | | | The insurance company factors in your current |
| long term disability insurance? First, the | | | | health and may exclude preexisting |
| insurance company itself should have a top | | | | conditions. Women and smokers may pay more |
| rating from Moody's, A.M. Best, and Standard | | | | for disability insurance because they make |
| and Poor. These agencies rate companies in | | | | more claims than non-smoking males. If you |
| terms of capitalization, growth, earnings and | | | | are in a high-risk job, your policy may cost |
| other indicators of financial stability. | | | | you more. |
| | | | |
| Secondly, you should make sure you understand | | | | Disability insurance policies can be |
| the terms of your policy. Some policies | | | | confusing. It is always best to sit down with |
| require a waiting period before you start | | | | a professional insurance agent to discuss the |
| receiving benefits. For example, your policy | | | | terms of the policy together and to ask |
| may have a six-month waiting period before | | | | questions until you completely understand the |
| benefits are paid. In this case, your | | | | details of the policy quotes being presented. |
| benefits would begin six months from the time | | | | |