4 Things You Probably Didn’t Know About Disability Insurance

In business, a little extra knowledge can go a long way. Whether you’re looking to close a deal, apply for a loan, or choose an insurance plan –– having any edge whatsoever can tip the scales in your favor. Unfortunately, though many professionals need disability insurance coverage, few appreciate some of the subtle nuances associated with the application process. On the other hand, taking some time out to learn about them now can save you significantly later on. To that end, here are four things you probably didn’t know about disability insurance that could nevertheless prove vital down the line:

Long-Term Disability Insurance vs Short-Term Disability Insurance:

Not all insurance packages cover both long-term and short-term disability claims. Many group insurance programs will include short-term coverage. (Sometimes, employers will refer to it as “accident coverage.”) However, few employer-based insurance plans will include long-term options for injuries and illnesses that last for years. Lastly, short-term disability insurance provides more diverse coverage than worker’s compensation will, and the two are not interchangeable terms.

Women Will Pay More:

Insurance companies are no longer allowed to charge different rates based on gender in regard to health insurance policies thanks to the Affordable Care Act. Yet, women are forced to pay more for disability insurance policies based on the propensity for claims filed by women to last longer and cost more money.

You’re Income and Your Pay Stub May Not be Equal:

Some professionals rely on a sole source of income to support themselves. And if they’re injured and meet the qualifications to trigger disability insurance payouts, then the insurance company will essentially match their income level. Not all sources of income are tied to a profession, though. Indeed, if a person were to regularly collect income through stock investments, for instance, its unlikely disability insurance would cover future income derived from investments. If the disability doesn’t preclude an individual from continuing to make money in a certain way, then insurance companies will be loath to shell out additional capital.

Occupation Affects Coverage Options:

On a basic level it makes sense why disability insurance should differ from occupation to occupation. After all, what inhibits one professional from doing their job may not necessarily prevent someone else. Therefore, doctor disability insurance, disability insurance for teachers, and disability insurance for police officers are all distinct from each other. True, there’s likely to be a large degree of overlap between disability insurance programs based on profession, but the devil is in the details and little discrepancies may drastically alter what an insurance company will or won’t cover.