DISABILITY INSURANCE FEATURES

WAITING PERIOD

The period of time from the date of your disability to the day when the insurance company commences its obligation. The longer the waiting period, the lower the premium. With good cash reserves one can afford a longer waiting period and save premium.

BENEFIT PERIOD

The period of time for which the insurance company is obligated to pay benefits. The longer this period, the greater is the company’s obligation and the greater will be the premium.

DISABILITY HAZARD

Some policies treat accidents differently from illness. It is generally better to buy adequate coverage and if necessary compromise on the benefit period or waiting period.

MAXIMUM BENEFIT

The maximum percent of present income one can insure is normally 60%. Insurance companies do not want an insured to “profit” from being ill, since it would discourage recuperation.

PAYMENT OFFSET

A ceiling of income benefits are paid by the insurance company - reduced or offset by “primary” social security or worker’s compensation if such benefits are ever, in fact, received. Family social security benefits plus inflationary increases does not reduce the insurer’s obligation.

PREMIUM WAIVER

Once the disability claim has been established, premiums are waived until the insured has recovered.