Disability Insurance Questions
Disability insurance is one of the most overlooked and valuable policies on the market. It provides an income when injury or sickness doesn't allow you to work. Disability income is available as short-term disability and long-term disability.
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What's an Elimination Period?
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An elimination period is the length of time of continuous disability before the company pays. Short-term disability may have from 0 to 90 days elimination period. Long-term disability elimination period may be as short as 30 days or longer than a year.
What's a Benefit Period?
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The benefit period is the maximum time benefits last. Short-term disability normally lasts for 26 weeks to a year. The long-term disability benefit period may last from a year to the age of retirement.
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How Much Income Does the Policy Replace?
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Short-term disability may replace 100 percent of the income or less for periods shorter than 365 days. Long-term disability often covers up to 65 percent of your income.
Where Do You Buy Policies?
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Most people get short-term disability coverage through work. Some states require employers to carry it. Long-term disability may be available through employers or purchased directly from an insurance company.
What is the Difference Between Any Occupation and Own Occupation?
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Disability policies often come with the option to select the definition most appropriate for your situation. If you're disabled and can't do the material duties of your job but can do another job, you'd receive disability income on the own occupation definition but not on the any occupation one.
What Is COLA?
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COLA stands for cost of living adjustment. If your disability lasts a long time, your payment won't have as much purchasing power in later years. A COLA rider increases the payment as the cost of living increases.
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