An Introduction to Disability Life Insurance:
Disability life insurance covers a
working person by paying a percentage (usually 50-60%) of lost monthly income if he gets temporarily or
permanently disabled. This protection is provided to keep his present lifestyle intact and so that he can pay for the medical expenses required to recover from the illness or injury that turned him disable. The advent of
disability life insurance has occurred recently.
Disability Life Insurance is a must because:
A worker expects the reward of hard
working as the ability to increase his or her personal assets and a secured and happy future. People tend to attach huge importance to death thus increasing the demand for
life insurance. The propensity to ignore possible
loss of income without death is quite high. But facts are just the opposites.
Research has proved that in one year 1 in 8 will be disabled but only 1 in 113 will die. Growing proportion of women and men in the age group of 45-65 years suffer from heart diseases, diabetes and hypertension. For most people death usually comes after retirement but becoming disabled during
working is quite common. The family receives a sum of money if the person dies but
disability brings in only inferior consequences. The person loses his source of income and remains a consumer alone. This makes him a liability. There are other disadvantages of
disability too. For instance, a temporary or permanent
loss in
health must be restored at least partially. A huge amount of the accumulated wealth is drained in meeting the enormous medical expenses. So a guarantee that one's flow of income will not get truncated if he becomes disabled is mandatory for every
working person. Although it doesn't eliminate the
risk of
disability but still alleviates the concern.
Disability life insurance secures monthly income and at times is tax-free too.
Disability Life Insurance is an innovative idea:
One can consider various options to have a secured future income in case of an
unforeseen event. But all resources are not equally preferable. For example there is an impression that half of all
Social Security disability claims are denied.
Group disability benefits from
employers cover only base pay and provides benefits that are taxable.
Limited benefits are available from
Worker's Compensation and that too are for a short period.
Banks are reluctant to lend. So one has to depend on his/hers spouse's income or a
disability life insurance plan that goes to work when the
insured is at home. The second option unambiguously sounds better.
Disability Life Insurance has out of the box gains too:
One can choose the elimination period i.e. the time period after which payment of benefits begin. Elimination periods in the case of disability life insurance are of 30, 60, 90 or 180 days. Lower is the elimination period higher is the insurance premium (the monthly payment to make the policy work).
For disability life insurance, benefits can last for 6 months as well as for lifetime depending on the occupation needs and the company of the insured.
Most disability life insurance plans have Surrender Value Riders. This is a very valuable rider that nearly all the premium one has paid after deducting any claims at the age of 65 years.
These benefits are not connected with Social Security or Worker Compensation so that in case of a claim the cover is extended to any of these traditional protections.
So opting for disability life insurance that costs only 2-3% of one's annual income is always a good idea.
For further information one may view sites like epgbenefits.com, 1insurancequoteslifedisabilityinsurance.com, disabilitylifeinsurance.com