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Disability Insurance Tips: An Income Umbrella for Today’s Top Professionals

Posted by : Premraj | Posted on : Saturday, June 3, 2017


Of all the different types of insurance that you can get, disability insurance is one of the most important.

The thought of suffering from a disability and being unable to work is a terrifying one, especially if you have dependents or large financial commitments like debts to pay back. This can be particularly important for professions like physicians where large student debts are the norm.

Disability insurance provides protection when the worst comes to the worst, so here are some tips to consider if you want to protect yourself.

Why Get Disability Insurance?

First of all, it’s important to know why you would want to get disability insurance in the first place. The main reason is your own peace of mind and that of your family. If you become ill or injured, insurance can become a lifeline, no matter how long you end up out of work.

It can cover your lost income, but it may also cover other related costs that are not covered by your health insurance, depending on the policy you choose.

One good test is to work out how much money you would have if you could not work, and then to look at all of your financial commitments.

If you don’t like the idea of being in that situation, disability insurance should be a strong consideration.

Know the Two Main Options

There are many considerations when buying disability insurance, and it starts by deciding whether you want short-term insurance or long-term insurance.

Short-term covers a large amount of your income, usually 80 percent, for a short time period, which is normally up to six months, but can be as short as two months.

For long-term insurance, this normally starts paying out after about six months, and it carries on for extended periods. They cover less of your salary, but payouts continue for longer, even for your whole life depending on the policy.

Start Looking Early

One of the best things you can do is to start looking for your insurance early on. This is especially important if you have large debts to pay back.

For example, physicians often build up huge debts when they graduate from medical school. If you’re in that same situation, consider insurance, even if you’re busy with your residency, and you might want to look into specialist Physician’s Disability Insurance in this situation.

Whatever your profession, if you have debts to pay back, it makes sense to get protected.

Look for Insurance for Your Specialty

When you start looking for insurance policies, make sure that you look for policies that cover your specialty. That may be a physician, but if not then find a policy for your situation.

Policies will usually state which skills are covered. You might be unable to carry out specific duties due to injury or illness, so you want to make sure you are covered.

Research Your Options Carefully

Always look at all the options before deciding on a policy. There are many to choose from, so take your time and do your research.

Look at recommended policies from third-party sources, and especially look for providers rated A++ because that means they should be a safe bet. You want to be sure that your policy provider is strong financially.

Compare Waiting Periods 

When you are choosing your policy, look at the waiting period. You may be able to choose a different waiting period, which is the amount of time you will not receive payments, and this can affect your premium.

A period of 90 days may lead to a lower premium than one of 60 days. But just remember that you would have to wait longer to receive your money should you become disabled.

Always Look for the Best Value 

It may be tempting to find the cheapest cover you can, but make sure you choose your policy based on value rather than price alone. A cheap policy may not provide you with the peace of mind you need. If you find yourself needing to claim on your policy, you don’t want to experience any problems because you chose the cheapest provider.

Protect Yourself If You Cannot Work

Being unable to work due to ill health or injury is a terrible situation to be in. It’s not going to be easy, but you can reduce the burden by making sure you take out disability insurance well in advance.

Whether you decide to take out insurance is up to you, but if you are concerned about what the future might bring, it makes sense to start looking into your options early on so you know what’s available for you.

Grace Lyons is a business finance consultant. Always looking for new ways to help entrepreneurs thrive, she loves to share her discoveries on a variety of finance and business blogs.


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