Disability Insurance Policies
If you became disabled or ill and unable to work, how would you pay your bills? Disability insurance protects your financial stability in the event of injury or severe illness. Some individuals look at it as paycheck protection while others view it as a way to protect their homes as a mortgage usually takes the largest portion of income.
Several types of policies are available, all of which supplement any disability packages provided by employers. Often, employer-provided plans do not cover the full extent of your costs and may only cover medical costs, not daily living expenses. A number of factors go into determining how much coverage you require, including your wages, monthly mortgage, property taxes and similar considerations. Disability benefits can be designated for a period of just a few months to more than 10 years or longer, depending on the plan chosen. Elimination periods, where you do not receive money from the beginning of your disability, varies according to the policy and the state in which you live.
The least expensive type of disability insurance is an accident-only policy. This type of policy will not pay funds for lost income in the event of sickness. Short-term disability policies will pay benefits to you for a period of your choosing from three to 24 months. Long-term policies typically provide benefits from a minimum of two years and go up to 10 or more years. Business owners can include a disability premium on their policies to protect their companies operations during the time that they are sick or disabled from injury.
Optional riders or policy types include plans that simply pay your mortgage or your credit debt during the time that you are ill or disabled. Addendums to policies can include rehabilitation expense benefits, survivor benefits, cost of living adjustments and hospital confinement benefits among others. Premium payments usually stop once the benefit period begins. Certain policies may allow you to receive partial payments once you are able to return to work part-time or may accelerate benefits if you are diagnosed with a terminal illness.