Disability insurance is considered as a good means to replace one’s income when a person is not able to work due to some kind of illness. Unlike the past, loads of people are getting seriously interested in disability insurance policy.
After all, it’s one of the most viable ways to secure one’s future when one runs out of luck. Today, two forms of disability insurance policies exist in the market. They are called as short term disability policy and long term disability policy.
Both these policies are distinct from each other in terms of payment. Long term disability policy holders might receive lifelong payment as long as one is disabled. On the other hand, short term disability policy holders might receive payment for a period of one year or even less than that. In either case, you will have to procure a policy in the first place to enjoy the benefits. Like everything else in life, disability insurance policy has a price tag. Let’s take a look at the factors that determine the cost of disability insurance policy.
The elimination period is one of the major factors that determine the cost of a disability insurance policy. Basically, it’s the period of disability before you start receiving your payments. As you may expect, those who opt for a longer elimination period have to bear low premium. On the other hand, those who opt for a shorter elimination period will have to bear high premium. Apart from the elimination period, the benefit period also plays a great role in determining the cost of disability insurance policy. The benefit period is the period for which the benefits are paid to the policy holder. Needless to say, long benefit period would involve a higher cost as opposed to short benefit period.
The occupation of the policy holder has a major role to play as well because insuring people who are working in a risk prone area might prove to be an expensive affair for the insurance company. Therefore, individuals who are involved with some kinds of dangerous work may have to pay more towards disability insurance policy. Your health records and the amount of money you receive every year will also be checked. Needless to say, having a clean medical record always helps. Insurance companies do not generally like to offer coverage to people who don’t have a clean medical record. Even if they do issue a policy, you will have to bear higher premium.
Lastly, the gender and age of the interested prospect is also evaluated for determining the cost of disability insurance. As such, most insurance companies have the right to increase their premiums. Generally, non reputable companies resort to such practices of hiking the price very often. Dealing with Empire life insurance and Transamerica life Canada may prove to be good affair over here because these companies have helped scores of people over the years. Experts generally advise people to obtain quotes from numerous companies to get good rates on an insurance policy without compromising on the quality.
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