All things you need to take note for Disability Insurance
Disability insurance is a type of insurance that provides financial protection in the form of regular cash income that is lost by employees when they lost their job as a result of accident and illness.
As with other types of insurance, there are so many terminologies and things to take note that it can even confuses a first class honors.
Below is a summary of all specific items to take note of for disability insurance.
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1. Waiting/elimination period
You don’t get the monetary benefits the next day after becoming disabled, The waiting period can be between 30 days to 180 days, depending on specific polices chosen.
In general, the longer the waiting period, the lesser the premiums will be, all else being equal.
2. Amount of monetary benefits
This basically means how much you get in a periodic term like per week/month/year. This is needed to compare and contrast premiums paid and total financial compensation received for similar disability insurance from different insurance companies.
Simply because your AIG insurance agent is not going to tell you that there is a better option from Prudential.
3. Duration of monetary benefits
Don’t assume that one is going to receive a fixed income – payouts from polices all the way until stepping into coffin.
The duration of payouts may be from as short as a few years to until stop breathing, even though one is disabled until in heaven/hell/next incarnation.
4. Definition of disabilities
There are many definitions for a term. Some people can even called a spoon a fork because he says that is what his mother taught him.
Similarly, many insurance companies and polices define disabilities differently, do not just listen to what your financial adviser says about what disabilities means, instead look at the definitions, terms and conditions inside the insurance policies in black and white yourself.
For instance, a dentist who accidentally injures his hand and cannot do what a dentist usually does but can still use his hand and be a toilet cleaner do not fall under the definition of permanent disabled under quite some disability insurance policies.
These four are the more crucial items to take note, all others are listed here.
http://www.iii.org/individuals/disability/types/
Coming up soon . . . . . .
Do you really need disability insurance?
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