Protecting Your Financial State: Three Factors To Consider When Purchasing Private Disability Insurance

Law Articles

Most Americans aren't prepared to deal with a disability, although the chances of struggling with a disability is actually quite high. In fact, 50% of Americans are at risk of struggling with a disability for 90 days or longer between the ages of 35 and 60. Most people simply aren't prepared to deal with the aftermath of a disability and will often fall into financial distress as a result. The best way to protect yourself is to purchase a private disability insurance policy that will provide you with some income during this time. If you're looking to purchase a plan, here are 3 factors that you need to take into consideration.

Whether the Assessed Risk Is Reasonable

The cost of the private disability insurance policy will be hugely influenced by the amount of assessed risk that the insurance company speculates you have based on your employment. For example, if you work in one of the top 15 most dangerous jobs in America, you can expect your private disability insurance premiums to be a lot higher than someone who works a less dangerous job.

Most insurance companies will be more than happy to break down how the premiums were calculated. This is a good time to scrutinize whether the amount of coverage that you are receiving match with the perceived risks associated with your career. Don't be afraid to point out any unreasonable assumptions, as this might help reduce your insurance premiums. In addition, the premiums are also often calculated on your health as well, so get the insurance while you're healthy.

The Amount of Buffer Paid Out by the Insurance Policy and Length of Payment

Most private disability insurance policies won't pay you the exact amount of your salary. Instead, they'll likely pay you a buffer, which is a percentage of your previous salary. Consider whether the amount that will be paid will be sufficient to cover your cost of living without causing you to have to go into debt. Keep in mind that you'll likely have to compromise some aspects of your quality of living when struggling with a disability.

It's also important to consider how long the insurance policy will pay you for your disability. While some policies will pay you until you reach retirement, other policies have a maximum threshold to the amount that can be paid out. Once you reach the maximum threshold, you're on your own.

The Conditions for the Disability

Even after you think you've found a private disability insurance plan that provides you with all of the coverage you'll need, you should take a closer look at the terms and conditions of the contract to determine whether any conditions need to be met. For example, consider whether the policy will only cover disabilities that were caused under certain conditions and circumstances. It's also important to consider whether there are any types of disabilities that aren't covered by your plan.

For your claim to be approved, you might also need to be able to submit certain type of paperwork. For example, you might need a specific type of medical document or have to go through certain protocols. It's important to know the specifics of your plan before deciding whether or not it is suitable for your needs.


A private disability insurance plan can help you out tremendously in the event that you have to deal with a temporary or even permanent disability. The chances of sustaining an injury that causes a disability is much higher than the chances of dying. It's important to be prepared and to protect yourself with a suitable disability insurance policy.

For more information, contact local professionals like Iler and Iler.


12 June 2017