How to Buy the Cheapest Disability Insurance

Temporary or permanent disability can severely compromise your ability to maintain a comfortable living condition, given the financial constraints of income loss. Disability may result from an accident or a pre-existing or sudden medical condition. It can aggravate as a person grows older and finds that his or her condition is not getting any better. Disability insurance can often be a life savior in such cases. Here is how you can buy cheap disability insurance.

Difficulty: Moderately Easy

Instructions

1. Assess your current earnings and future income. If your family solely depends on your income, then you definitey need disability coverage.

2. Check with your employer before buying from private insurance providers. If your employer does not have a cheap option, then consider getting a membership in a professional organization. Such organizations often offer good disability insurance benefits under a group plan.

3. Choose a group policy instead of a single policy. A single policy costs 5 to 10 times more than group coverage.

4. Understand the premium determination criteria for disability coverage. Age, occupation and annual income are the most important factors in determining the premium.

5. Choose a non-cancelable policy, as it ensures that your premiums will not increase later.

6. Opt for a short duration of coverage. The longer the duration, the more expensive the premium.

7. Remember that an "Any Occupation" plan is considered to be the cheapest disability plan. It provides coverage in case you cannot work at all due to disability. Other policies such as "Own Occupation" are quite expensive.

8. Consider buying an "Income Replacement" policy if you are not a high-income earner and only wish to get coverage for your family in the future.

Tips & Warnings

• Make sure that you buy the "waiver of premium" option, so you can stop paying premiums after receiving the benefits of the disability claim.
• Get memberships in organizations that offer excellent disability insurance benefits under the group plan.
• Remember that there is a waiting period for getting disability benefits. Shortening this period can raise your premium rates.