Copyright (c) 2007 Keith Mallinson
We would all like to know exactly what was going to happen to us in the future, good or bad although it is hard planning for the good it is much easier, although less pleasurable to make arrangements for the bad but disability insurance can help. Often the biggest strain when you are unable to work is that knowing you must try and recover as quickly as possible for the sake of your family, and this causes additional stress so disability insurance can act as a safety net whilst you are incapacitated. The chances of you being in need of disability insurance before the age of 65 far exceeds the possibility of death prior to this age. Unfortunately, this fact is often overlooked when life insurance coverage is being arranged. If you are aged 40 for example, there is a higher chance that you will be disabled, and thus unable to work for a period of 90 days or more, than of you dying before the age of 65.
Of course, when someone is seeking disability insurance cover, it is imperative to find the best disability insurance rates and plans available. Unlike life cover, disability insurance rates are based on the potential income lost as well as, age, occupation and general health. There are a few ways of reducing the cost of your disability insurance with the main one being selecting a longer period of time or waiting period following an accident or illness before the disability insurance payments commence. Some people find that by setting the plan to pay for only a set period of time, they can dramatically reduce the premiums they have to pay as it eases the potential burden to the insurance company but can be a problem if the time out of work lasts longer than the plan provides for.
Whatever your situation though, common disability insurance usually covers only a specific percentage of your original salary. Reduced period disability insurance is also known as short term disability and although it may only last a few months, the benefits can be greater to the claimant. On the other hand, total disability insurance can provide limited financial cover for a much longer period but it will be the responsibility of the claimant to prove that they are unable to carry out work related tasks that provided their income previously. Whatever the situation though, a person making a claim owing to incapacitation will be sent a disability benefit check every month until the end of the plan or they return to work.
Some key issues to research in disability insurance policies include, pre-existing conditions, your own occupation versus any occupation, timeframes and whether or not the monthly benefit payment is taxable or tax free. Each policy is different so the amount of salary the disability insurance plan will pay will depend entirely on the policy you decide to go with. To give you an example: some disability insurance plans pay out as much as seventy percent of your monthly income in benefit whereas others can pay as low as forty percent so you need to do your research to avoid being paid less than you can afford to survive on. More than any other factor, it is this one that you need to be sure of as once you have taken out the plan and found it necessary to make a claim, it will be too late for you to change it.
