Terms of Disability Insurance Vary Greatly

Article excerpt

Many people who conscientiously provide for their survivors' needs with life insurance often overlook insuring against their inability to work and support themselves.

No one wants to think about being disabled. Yet statistics from insurance underwriters show that if you are between the ages of 35 and 65, you are three or four times as likely to be disabled for at least three months as you are to die during those years.

In one respect, disability insurance may be even more necessary than life insurance. A deceased spouse is no longer producing income, but is also no longer consuming the family income.

On the other hand, a disabled spouse may cease producing income, but will continue to consume the family income and may consume even more than before because of medical care and special needs arising from the disability.

Think about what would happen if you or your spouse had a serious accident or illness and couldn't work for a year. How would this personal catastrophe affect your plans for your children's education or your retirement?

How would you cover the expenses of home care and unreimbursed medical expenses, or to hire someone to do the household chores you no longer could manage?

Most people simply have no idea what protection is available if they become disabled through illness or accident. They are unaware of the different meanings of disability as the law and insurers define it. They don't know what kind or the amount of protection to buy.

Disability insurance is available only to those who are employed. Many working people are covered to some extent by government or employment disability plans.

How strictly a plan defines disability will determine the amount of protection it offers. For example, if a plan requires that you be totally disabled, then before you could receive any benefits you might have to show that you are unable to perform every duty pertaining to a specific occupation, or even worse, unable to engage in any other type of paid work as well.

On the other hand, a plan that insures against partial disability will require only that you be unable to perform one or more functions of your particular job. …