Tuesday, October 13, 2009

Disability insurance is essential

We give out a financial tip on Twitter every day. For the past two weeks or so, we've given tips on disability insurance. This type of insurance is ABSOLUTELY essential for anyone in the work-force. Here are all the tips pulled together in one spot so you can review them. Please pass these on to friends who need it.

- Disability insurance is important. You have a greater chance of becoming disabled than dying.

- Look for disability insurance through your employer first. That is usually the best place to find it, and you’ll get a better rate as a member of a group.

- Disability insurance: one factor to examine is elimination period. That is the waiting period before payment begins. Longer = cheaper.

- Disability insurance: ask about waiver of premium. That means you won’t have to pay premium while you are disabled.

- Disability insurance: Inflation rider adjusts the amount of payout according to the cost of living. Great if you can get it.

- Disability insurance: Non-cancelable clause. As long as you pay the premium, the insurance company can’t cancel it.

- Disability insurance: Renewable means you can extend it if it expires.

- Disability insurance: Own occupation means that you will be paid a portion of your income if you cannot perform your current job.

- Disability insurance: Any occupation means that you will only be paid a portion of your income if you cannot work at all. Go for own occ if you can get it.

- Disability insurance: Some insurance companies market a hybrid policy; first 2 years is own occ, then switches to any occ.

- Disability insurance: Expect policy to pay out 60 to 70 percent of your income, maybe lower.

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