How To Buy Disability Insurance

Of course, without understanding someone’s complete financial situation, it is impossible to give a straight “yes” or “no” answer, I can provide some insight as to when it is smart to buy disability insurance.

Personal, individual coverage may not be possible for those in high-risk employment categories.

If you’re a full-time employee with benefits, there is a good chance that you receive some sort of disability insurance.

Individual disability insurance is truly a basic concept.

I will provide you with information regarding the major features of a disability insurance policy so that you may better understand how to read a disability insurance policy.

My current employer doesn’t provide disability insurance, so I have my own policy.

Of all the types of insurance available, the one I hear the least about is disability insurance.

The first question you need to ask is whether the insurance company you’re eyeing is financially sound, said Crawford.

If your employer does not provide group disability insurance coverage, it may make a disability benefit available to you on a voluntary, employee-paid basis.

You may be eligible for more coverage under a voluntary plan than is offered by a traditional group plan.

Make up any difference between your company’s coverage and your needs with disability income insurance from a quality disability income insurance company.

If you need to buy your own coverage, be prepared to undergo complete disclosure of all medical and financial information to the insurance company.

If you make a decision to purchase coverage from another disability insurance agency, make sure the policy is Non-Cancellable and Guaranteed Renewable, contains a pure own-occupation definition of total disability, and has no time or duties requirement to pay a residual claim.

If you leave, you won’t have income anyway and the insurance doesn’t matter.

JC, while it is true you can’t take an employer’s disability plan with you when you leave, you will pay a significant premium if you decide to buy your own coverage.

Buy residual or partial disability coverage.

“Unless you’re independently wealthy, you need insurance if you stand a chance to lose your income because of a disability,” said David Woods, president of the Life and Health Insurance Foundation for Education.

Decide whether you are willing to accept that risk yourself, or whether you would prefer to transfer the risk to an insurance company, if you can qualify.

Call your employee benefits department and apply for or buy as much of the company’s group coverage as you can.

You can buy optional riders that provide for cost of living and future earnings increases.

Supplement your company’s plan with individual long-term disability coverage if your employer’s program won’t cover all of your family’s expenses.

I’ve written about how hard it is to qualify for, and receive Social Security disability benefits in the past.

Shopping for any insurance policy requires some homework since there are a lot of shady sales reps and companies that may appear to offer low-cost coverage.

You need to protect against it if you can, but if your finances are already in disarray, you need to get that house in order before you can take on another monthly payment to obtain insurance.

A guaranteed renewable policy is less desirable.

Should you ever need the protection a disability policy can offer, you’ll be glad you took financial precautions.

Without coverage, an unexpected disability can easily drive you into serious debt.

“Most people say, I don’t need disability coverage - I’ve already got it through work,” said Crawford.

Some DI companies has their own definition of disability.

Typically, little underwriting is involved and premiums are based primarily on your age and income.

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