Disability Insurance

Choosing Disability Insurance: Top 5 Things to Consider

People get insurance for just about everything: life, vehicle, inventory, and more. Some pet owners even get pet insurance! The thought may have not crossed your mind to get disability insurance. 

Have you considered what would happen if you got sick and couldn’t work for a time? Disability insurance can make up lost income in the case of an accident or illness. 

There’s the option of selecting short or long-term disability insurance. Regardless of which you choose, it’s nice having the security of disability insurance. 

If you’ve been thinking about shopping for disability insurance, there are things to keep in mind. Consider these five tips so you’ll make the right decisions and find a company and policy that works well for you. 

1. Whether it’s Transferable 

Not all disability insurance policies are transferable. If you have insurance through your employer, find out if you can keep it if you no longer work there. 

It’s important to take note that not all insurance policies are portable. It may not be possible to transfer your disability insurance to a new job. If that’s the case, it’s best to learn this information now. It’ll be frustrating hearing later that it’s not transferable! 

If you find out your current policy isn’t transferrable, consult with your employer. They may have some feedback or can get in touch with the insurer. Or, you can take out a separate policy that you can transfer over when leaving the company. 

2. Whether You Can Lock in a Premium 

When deciding on disability insurance, find out whether you can lock in your premium. Some policies provide this option, whereas others do not. 

Having either a guaranteed renewal policy or a non-cancelable policy are two options. Your coverage won’t change with a guaranteed renewal, but your premium may go up or down. 

With a non-cancelable policy, your premium and coverage are locked and won’t change. If you don’t see yourself canceling your policy anytime soon, this is the way to go. 

There is one caveat to a non-cancelable policy, though: Make sure you always pay on time! If you submit a late payment, you’ll likely lose out on keeping the same rate, and it could go up. You don’t want this to happen, so stay on top of paying your bill on time. 

3. Whether the Waiting Period Is Short or Long 

If you do end up getting injured and cannot work, understand how long the waiting period is. It may take a lot longer to get coverage than you initially thought.

There’s no doubt you’ll save money if you have a more extended waiting period. But depending on your financial situation, you may need your insurance to kick in earlier. At first, a longer waiting period may look appealing because you’ll be able to save money.

But when you need the financial support, you’ll be glad you chose a policy that has a shorter waiting period. In the long run, it’s more cost-effective and is available for you to use a lot sooner.

4. Whether Residual Benefits Are Available 

Also, look into whether residual benefits would be available if you were unable to work. Residual benefits mean if you’re still working part-time, the benefits will make up the rest of your income

Before committing to an insurance policy, read the fine print. Make sure there aren’t any restrictions. If you’re going to have residual benefits, ideally, you should be able to use them without hassle! 

5. Whether an Advisor Can Point You in the Right Direction

Think about hiring an advisor to help you find the right insurance policy. Independent consultants who work for insurance companies can come to your aid. They can ask you a series of questions and find out what kind of policy you need. 

Sometimes it’s hard to weed through all the insurance companies. You must find the right one without losing out on any benefits. 

An advisor can offer recommendations and advice on which direction to go.

Conclusion

Going without disability insurance is like going without car insurance. You can’t do without it. While looking for the right company and policy that works for you takes time, it’s time well spent. 

Once you’re set up with a policy you’re comfortable with, you can rest easy. If you suffer from a severe accident or injury, you’ll feel good knowing you have insurance in place. 

Disability insurance will keep you afloat while you recover. And it’ll give you peace of mind that you can care for yourself and your family.

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