Disability Coverage

Disability insurance policies are designed to pay part

of your wages should you be injured in an accident or

are unable to work because of illness. Here are two

types of policies available: long-term disability and

short-term disability.

Short term disability pays a portion of your wages

should you be out of work due to injury for up to one

year. Some employers pay for this benefit for their

employees, some offer it for employees to purchase.

If you have a pre-existing medical condition, the time

to enroll is during the initial enrollment period when

a medical exam is not required.

Replacement of wages is only partial; insurance

underwriters, as well as your employer, want you back

at work as soon as possible. Usually there is a

waiting period of 14 days in which you will not

receive payment.

Long term disability policies are purchased to replace

what your potential earnings would be from the time

you become disabled until age 65 when Medicare would

be available.

For instance, if you are 55 and make $40,000 per year,

you should purchase a policy for $400,000.

You cannot get a long term disability policy if

(1) you are or are soon to be pregnant,

(2) make less than $18,000 per year,

(3) are unemployed, or

(4) you are required to carry a weapon for your job.

Typically, the waiting period for long-term insurance

to kick is at least 60 days and as much as a year.

Disability insurance is an important aspect of your

overall insurance coverage plan, and if your employer

offers it as a benefit you should definitely consider

it as a wise investment.

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