ABC of disability Insurance
If you are not a strong believer that disability insurance can't be useful for you because you are in a desk job and a safe driver, kindly go through the facts and statistics further presented here. Often people think that death is inevitable but permanent disability out of an accident may or may not happen during the life time. Therefore people approve of taking life insurance policies but don't go for a disability insurance policy. The fact of the matter is both life and disability insurance are important if we want some kind of financial surety in our future.
People are more likely to insure their lives but forget to insure their livelihood. Few people know that they are more likely to receive benefits from disability insurance than a life insurance policy. Average Life span of individuals is increasing, and at the same time fatal accidents have also been on an increase. According to a study a 20 year old healthy individual has 3/10 chance that he or she would become disable before retirement age.
Ability to work and generate income is perhaps the greatest asset anyone could have. Loosing this ability on permanent basis would mean there is no way to take care of yourself and your family. You might have some savings but they would also last for a limited period of time, what do you do after that? Many people have no choice but to claim for bankruptcy in case they are permanently incapacitated. But if you have planned for your future more meticulously there would be disability insurance to take care of your financial security.
Disability plans are designed in such a way that you can still maintain 45-60 percent of your gross tax free income even after becoming permanently disabled to work anymore. Changes in your physical or mental state which forbids you from working in your current job, either due to an accident or a disease, can be termed as 'disability' can comes under the preview of disability insurance. Before finalizing your disability insurance policy be careful on the following points:
• Make sure you disability policy is 'guaranteed renewable', which means in case you are paying your premiums on time the insurance company should not have an option of discontinuing or cancelling the policy till the insured period expires.
• Elimination Period - This is the time frame after which the disability policy kicks in and starts after the time the insurer becomes permanently disable. The elimination Period can be any time between 30 days to 6 months. Shorter the elimination period higher would be the insurance premium. Carefully choose your elimination period.
• Occupational Class - This is yet important factor in deciding premiums and importance of disability insurance policy for you. The occupations where there is more likelihood of accidents will have higher premiums and also at the same time it will be more important for you to have a disability insurance policy.
Hope the above information would be useful for you while deliberating on whether you should go for a disability insurance policy or not.
People are more likely to insure their lives but forget to insure their livelihood. Few people know that they are more likely to receive benefits from disability insurance than a life insurance policy. Average Life span of individuals is increasing, and at the same time fatal accidents have also been on an increase. According to a study a 20 year old healthy individual has 3/10 chance that he or she would become disable before retirement age.
Ability to work and generate income is perhaps the greatest asset anyone could have. Loosing this ability on permanent basis would mean there is no way to take care of yourself and your family. You might have some savings but they would also last for a limited period of time, what do you do after that? Many people have no choice but to claim for bankruptcy in case they are permanently incapacitated. But if you have planned for your future more meticulously there would be disability insurance to take care of your financial security.
Disability plans are designed in such a way that you can still maintain 45-60 percent of your gross tax free income even after becoming permanently disabled to work anymore. Changes in your physical or mental state which forbids you from working in your current job, either due to an accident or a disease, can be termed as 'disability' can comes under the preview of disability insurance. Before finalizing your disability insurance policy be careful on the following points:
• Make sure you disability policy is 'guaranteed renewable', which means in case you are paying your premiums on time the insurance company should not have an option of discontinuing or cancelling the policy till the insured period expires.
• Elimination Period - This is the time frame after which the disability policy kicks in and starts after the time the insurer becomes permanently disable. The elimination Period can be any time between 30 days to 6 months. Shorter the elimination period higher would be the insurance premium. Carefully choose your elimination period.
• Occupational Class - This is yet important factor in deciding premiums and importance of disability insurance policy for you. The occupations where there is more likelihood of accidents will have higher premiums and also at the same time it will be more important for you to have a disability insurance policy.
Hope the above information would be useful for you while deliberating on whether you should go for a disability insurance policy or not.
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