Disability insurance provides partial income so you can pay your bills if you get too sick or injured to work. Disability happens to more people, more often than you may think. In fact, more disabilities are caused by illness than injury, including common conditions like heart disease and arthritis, and most disabilities are not covered by Workman’s Compensation.
Disability insurance pays you a percentage of your income if you get sick with a serious illness or experience an injury that prevents you from doing your job.
It’s financial protection that helps you focus more on your recovery and less on how you’ll cover expenses. In addition to your income, here are some of the most important things in your life that disability income insurance helps protect:
- Your home
- Your retirement
- Your family
- Your personal savings
- Your lifestyle
People may incorrectly assume what qualifies as a “disability.” For example, they may believe the term applies to catastrophic conditions, such as paralysis from a car accident or a debilitating stroke. However, disabilities typically are the result of less severe injuries and more common conditions such as pregnancy, back pain, depression, and digestive disorders.
Every disability policy has a specific definition of disability that you must meet in order to get benefits. The two most common definitions used by disability insurance companies are:
- Own occupation: a person is considered disabled if they are no longer able to perform the occupation, they had prior to becoming disabled.
- Any occupation: a person is considered disabled if they are unable to perform any job at all.
The type of policy you select is a key factor to your premium payment amount. Here are your two options:
- Non-cancelable: Your premiums are locked in, and your coverage is guaranteed for the duration of the benefit period you select, as long as you pay your premiums on time or within the grace period
- Guaranteed renewable: Your coverage is guaranteed as long as you pay your premiums on time or within the grace period. Your rates could be increased only if the change affects an entire class of policyholders
No Cost Optional Benefits
Increase your monthly benefits by selecting one or both of these options:
- Automatic Increase Benefit (AIB): Automatically increases your monthly benefit by 4% each year.
- Future Insurability Option (FIO): Increases your monthly benefit every three years after you buy the policy
Additional Optional Benefits
Customize your policy with optional benefits to enhance or extend your benefits. There is an added cost for the following optional benefits.
- Extended Regular Occupation: Extends your current occupation coverage for the length of the benefit period.
- True Regular Occupation: Extends your current occupation coverage for the length of the benefit period and allows you to receive full monthly benefits if you are unable to work in your occupation and currently working in a different occupation
- Residual Disability: Pays a percentage of your total monthly benefit if you’re partially disabled. Enhanced Residual Disability is also available to additionally provide a recovery benefit if you’re still experiencing a loss of income after you return to work full time.
- Return of Premium: * Returns a portion of the premiums paid less claims paid.
- Cash Value Benefit: * Provides a percentage of all premiums paid for the policy and riders, minus any benefits in claims.
- Mental or Nervous and Substance Abuse Extension: Extends your mental or nervous disorders and substance abuse coverage for the length of the benefit period
- Catastrophic Disability Benefit: Pays an additional benefit amount if you have a catastrophic disability and you’re unable to perform at least two activities of daily living without substantial assistance from another person or require substantial supervision due to severe cognitive impairment
- Cost-of-Living Adjustment: Increases your benefit annually when you receive benefits
- Social Insurance Supplement: Lowers the premium since the benefit you receive is the amount of monthly income you purchase, less any benefits provided by Social Security.
Note: options may vary by state and/or age, * Conditions and limits apply.
