YOU are Your Most Important Asset
When it comes to insuring your assets, the most important thing is not your house, or any material object; the most important asset is YOU and your ability to work and provide for your family. At Landmark Insurance & Financial Group, our knowledgeable team of Health Insurance Specialists can help guide you to the Disability Insurance Plan that best suits you.
Each Disability Policy varies from company to company, but with the aid of a Landmark Insurance Agent and; if you purchase a Disability Insurance that is right for you, and hypothetically become disabled an unable to work, you will be able to continue to pay your bills and keep you and your family from serious debt. A Disability Insurance Policy will pay a portion of your income, usually between 50 and 70 percent if you cannot work as a result of injury or illness.
One of our Health Insurance Specialists at Landmark Insurance can look at the individual factors in your life and work situation and help you find the policy that best meets your personal insurance needs.
How Much Does Disability Insurance Cost?
Disability insurance has a variety of factors which influence the final premium. Each of the following factors will determine the actual cost:
Age: The older the applicant, the higher the premium will be. The minimum age for applying is 18 and the maximum age is usually 60.
Sex: Unlike life insurance, female rates are higher per unit of coverage than those for male applicants.
Smoker vs. Non-smoker: Those who smoke can expect to pay as much a 25 percent more for the same protection as a non-smoker.
Benefit Amount: Disability policies are typically issued with a specific monthly benefit amount.
Elimination Period: Sometimes this factor is referred to as the “waiting period.” It refers to the period of time before benefits are paid.
Occupational/Income Class: Most disability companies have four, five or six occupational classes into which each applicant is assigned. Those who are in professional occupations (i.e., attorneys, CPAs and architects) will be placed in the highest classification and, therefore, will have a lower cost per unit of coverage. The physician classification will vary by carrier – some rate them at the highest classification, while others place them a notch or two below the top class. Conversely, an applicant in a blue-collar-type job will pay more per unit of coverage.
Benefit Features: Some companies offer policies that are self-contained, meaning that the pricing is based on all the benefit features included in the policy. On the other hand, there are companies that will let you build your own policy to suit your needs and affordability.
Ratings: Some applicants may have a pre-existing health problem that may cause the insuring company to place an extra rating on the policy. This is to protect the company against the extra risk it is assuming.
Terms You Should Know When Shopping for Disability Insurance:
Disability: There are 5 definitions of Disability:
- Total disability -you cannot work at all.
- Partial disability -you cannot perform all of your job functions, but you can perform some of them.
- Permanent disability- doctors do not expect you to recover from your injury or illness. A permanent disability could be total or partial.
- Temporary disability -is one you are expected to recover substantially from. A temporary disability could be total or partial.
- Presumptive disability- you have suffered from something that automatically qualifies you to receive immediate disability payments; your insurance company will presume you to be disabled.
Benefits: The amount the insurance company pays for covered services.
Own-Occupation – You are not able to perform the material and substantial duties of your occupation, even if you are gainfully employed in another occupation. If you meet the definition of totally disabled and you become employed in a new occupation, your total disability benefit will not be affected by any income from the new occupation, regardless of the amount.
Elimination Period: (Waiting Period) A type of deductible; the length of time the individual must pay for covered services before the insurance company begins to make payments. Increasing your policy’s elimination period reduces the premium, because the insurance company has to pay less benefit. Another term for this is a “waiting period.”
Benefit Period: The benefit period refers to the length of time that the benefit is paid once you have satisfied the elimination period and are on claim. Policies commonly pay for two, five or 10 years and to age 65, 66 or 67. The longer the benefit period, the higher the cost will be. Your benefits stop when you return to work in your occupation, or depending on the contract to another occupation making the same income.