DISABILITY Insurance Policy
Unforeseen circumstances can wreak havoc on our best laid plans. After we have developed a game plan with clear goals, something outside of our control can move the goalpost.
A significant percentage of workers will experience temporary or permanent disability before reaching retirement age, which is why disability coverage is often considered one of the most essential types of workers benefits. After all, ones earning potential is likely one of their most valuable assets.
Insurance planning can help iron out the wrinkles of life when our expectations for the future are turned upside down. Disability insurance, in particular, can provide a monthly revenue stream in the event of an accident or an extended illness. It is intended for any working individual who wishes to reduce the negative effect that a disability would have on earning potential. Some employers offer group insurance, and individuals can purchase coverage on their own. Policies differ in how soon they initiate payments after a claim, as well as in the duration of the payments.
There are two broad categories of disability insurance:
Short-term policies begin paying benefits soon after an accident or illness but pay out for a limited duration.
Long-term policies have a longer waiting period before benefits ensue but pay out for a much longer period.
An insured individual can acquire both short-term and long-term coverage. Even though payments do not typically extend beyond retirement age, some policies do contain provisions for lifetime benefits.
The typical group disability policy is intended to replace only a portion of lost earnings, but coverage can be increased by adding an individual supplemental policy. The vast majority of injuries leading to disability occur off the job, so workers compensation insurance provides no assistance for accidents that occur on personal time. Thats when disability protection will be the most helpful.