Disability insurance is designed to pay part of your salary if you are injured in an accident or unable to work due to illness. Here are two types of policies available: long-term disability and short-term disability.
Short-term disability pays part of your wages should you be unemployed for up to one year due to an injury. Some employers pay this benefit to their employees, others offer it to their employees for purchase.
If you have a pre-existing condition, the time for enrollment during the initial admission period is when no medical examination is required.
Reimbursement is only partial; The insurer and your employer want you to get back to work as soon as possible. Usually there is a waiting period of 14 days during which you will not receive any payment.
Long-term Disability Policies are purchased to replace what your potential earnings from retirement to 65 years of age would be if Medicare were available.
For example, if you’re 55 and earning $ 40,000 a year, you should buy a $ 400,000 policy.
You can not receive a long-term disability policy if
- you are or will soon be pregnant,
- make less than $ 18,000 a year,
- are unemployed, or
- You must carry a weapon for your work.
As a rule, the waiting period for a long-term insurance cover is at least 60 days and a maximum of one year.
Disability insurance is an important aspect of your overall insurance plan, and if your employer offers it as an advantage, you should definitely consider it a smart investment.
