Disability Insurance

What are the types of long term disability insurance?

1. Non-cancelable means the policy cannot be canceled by the insurance company, except for nonpayment of premiums. This gives you the right to renew the policy every year without an increase in the premium or a reduction in benefits.
    
2. Guaranteed renewable gives you the right to renew the policy with the same benefits and not have the policy canceled by the company. However, your insurer has the right to increase your premiums as long as it does so for all other policyholders in the same rating class as you.

In addition to the traditional disability policies, there are several options you should consider when purchasing a policy:

• Additional purchase options
  Your insurance company gives you the right to buy additional insurance at a later time for an additional cost.
   
• Coordination of benefits
  The amount of benefits you receive from your insurance company is dependent on other benefits you receive because of your disability. Your policy specifies a target amount you will receive from all the policies combined, so this policy will make up the difference not paid by other policies.
   
• Cost of living adjustment (COLA)
  The COLA increases your disability benefits over time based on the increased cost of living measured by the Consumer Price Index. You will pay a higher premium if you select the COLA.
   
• Residual or partial disability rider
  This provision allows you to return to work part-time, collect part of your salary and receive a partial disability payment if you are still partially disabled.
        
• Waiver of premium provision
  This clause means that you do not have to pay premiums on the policy after you’re disabled for 90 days.