Long-term disability insurance is designed to safeguard those who are unable to work for a long length of time – usually several months, years or decades. Most insurance plans – both health insurance and auto insurance – slice away a lump sum amount after a claim is received. However, long-term disability insurance belongs to a different league as it pays out for a long length of time – for years or decades – depending on individual policy.
How Long It Works
When applying for long-term disability insurance benefits, you need to consider two important points – the length of your benefit period and the length of your elimination period.
Benefit Period: It refers to the time period when disability benefits are paid out. There is a wider diversity of plans that pledge to pay out for two years, five years or until you hang up your boots.
Elimination Period: Also referred to as ‘Waiting Period’, it is the time period that you have to wait for receiving benefits. It can be anything – 30, 60 or 60 days and even may extend to 6 months or 1 year.
You should choose the length of each period quite wisely on the basis of your financial condition and other insurance products at your disposal and how much you can afford. Check the conditions that qualify for long term disability before applying for the benefits.
Long-Term Disability Insurance Elimination Period – How to Choose the Right Length
Before knowing when your benefits will come to an end, you need to enquire when it will actually kick in. And it will start only after the elimination phase. You need to suffer from the same disability throughout the elimination period in order to enjoy the benefits. It is important as the scenario explains you have been dealing with long-term disability and therefore, establishes it clearly that you are entitled to long-term disability benefits.
At the same time, it’s also important for your insurer to ensure that there is no overlapping of your long-term coverage on your short-term disability benefits that you currently have.
Most elimination periods are anything between 30 days and 1 year. Your particular elimination period or waiting period is subject to your choice while applying for long-term disability insurance.
Is there anything that can be called the right elimination length in your case? Yes and it depends on your financial strength that allows you to decide the amount of premium and how long you can manage without receiving any payment.
Shorter Elimination Period – Know Your Benefits
The main reason behind choosing a shorter elimination period is you have already incurred lots of expenses that you cannot afford to meet without receiving income. The dilemma is waiting period is inversely related to the higher premium. Therefore, if you are in a tight condition and so cannot afford a higher premium, you are going to spend many sleepless nights due to the lengthy elimination period.
Longer Elimination Period – Know Your Benefits
A longer elimination period clearly means lower premiums. You should have a clear idea of the premium rate that comes with any type of insurance before choosing a particular product. If you find no problem in paying premium for long-term disability benefits, it’s better to opt for a longer elimination period.
