Disability Insurance FAQs
Q: What is Disability Insurance?
A: The purpose of disability insurance is to replace the lost income from work should you become disabled, and unable to work. The disability insurance policy will stipulate when you are eligible to begin receiving benefits. Usually, you must be unable to work for a specified amount of time before disability benefits begin to be paid to you. The amount of the payments, the duration of coverage, and a description of exactly what constitutes a disability are contained in the policy. The premium for the policy is determined by a number of factors, including: the amount of the income payments, the length of payments, exactly what constitutes a disability, and such personal risk factors as the state of health and type of employment of the insured.
Q: Is Disability Insurance difficult to obtain?
A: Generally, if you are in reasonably good health and have a steady income, you should be able to purchase a disability income policy.
Q: Who should purchase Disability Insurance?
A: Anyone who works for an income should consider disability income insurance. First, check to see what disability insurance you already have. You may be covered under group disability, income continuation, Social Security Disability, workers compensation, or other plans. State-sponsored disability insurance plans are also available in several states (including California, Rhode Island, New Jersey, New York, Hawaii and Puerto Rico).
Q: What are the types of disability insurance?
A: There are two types of disability policies: Short-Term Disability (STD) and Long-Term Disability (LTD):
Short-Term Disability policies (STD) have a waiting period of 0 to 14 days with a maximum benefit period of no longer than two years.
Long-Term Disability policies (LTD) have a waiting period of several weeks to several months with a maximum benefit period ranging from a few years to the rest of your life.
Q: What does Disability Insurance cover?
A: After an initial period called the elimination or waiting period, disability income insurance pays a specified percentage of your income while you are disabled. The payments continue for the duration of the disability or until the maximum time limit stipulated in the policy. As a rule, insurance companies will not allow you to have disability coverage for more than about 60 percent or 70 percent of your normal taxable income
Q: Some policies cover only accidents or only illness, or both. Should I buy a policy that covers both?
A: You are better off having a policy that covers both accidents and illness, since you do not know in advance what may cause you to become disabled.
Q: Do you presently have Short-Term and Long-Term Disability through your place of employment? Do you know how much you will receive if you become disabled?
A: Take the time to make sure you know the amount that you will receive if you become disabled. There is a factor that impacts the amount that you will receive. Do not wait until it is too late and then find out. Give us a call and we will be glad to show you how the factor can impact the amount that you will receive.
Q: Does my occupation or the type of work I do have a bearing on my eligibility?
A: Yes, it can but we will work with you to determine your eligibility and to find a plan that fits your needs
