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Disability Insurance protects your income. It provides income to you when the injury or sickness you obtain, does not arise out of work. Disability Insurance may come in the form of a group or individual policy.
The role of a disability policy, whether individual or group, protects a certain amount of the employees' salary. The insured may collect a portion of their salary once they become ill or injured, as long as their elimination period has been sufficed. Once the individual is able to return the work full time the benefits will end completely in all likelihood. It should be noted that injuries or sickness arising out of the job are protected by Workers Compensation.
The stereotypical model for a person labeled as disabled is someone in a wheelchair. However sickness can be just as debilitating as injuries from an auto accident. Some people are unaware that disability claims can include sickness, but they can.
There are two types of disability policies, short and long-term. Short-term policies last less than two years, while long-term can last to age 65 or older. Both serve their purpose but be aware of the difference.
Group Disability Insurance is often the only way for employees to qualify or pay for disability insurance. The medical history of some employees may cause them to be turned down for an individual policy. Yet depending on the size of the company for Group Disability Insurance, simplified or little underwriting may occur. While others may be stretched to the limit with other debt or bills to pay for another policy.
An Individual policy is written based on occupation, salary, and elimination period. In both individual and group policies, each individual can qualify for a certain amount of benefit based on their salary. Their occupation will influence the price of weekly or monthly benefit. The elimination period tells you how long you must wait before benefits can begin.
The reason to have to have disability insurance is protect your salary from accident or sickness. While individual may purchase this policy, employees may have Group Disability Insurance at work. Remember that you risk your own earning power without proper coverage.
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