Running Head: DISABILITY INSURANCE POLICY
Disability Insurance Policy
DISABILITY INSURANCE POLICY
Disability insurance policy is a cover that is intended to replace a significant portion of an
individual's income when injury or sickness prevents him/her from earning a living. The policy
can assist in payment of monthly bills that are regular while an individual is in the recuperating
period but is still not in a position to continue doing his/her job. In the case of a disability, for
instance, after an accident, the policy covers the expenses as well as loss of income. There are
two types of disability insurance; the short-term which replaces a part of the paycheck for a short
period, that is, around three to six months and the long-term which provides coverage when an
individual is not in a position to work for an extended period, that is years up to even decades.
Policy Elimination Period and Its Length of Time
Elimination period in the disability insurance policy is the number of days that must pass
in disability for the benefits to be payable. The days must not be consecutive, and benefits do not
accrue during this period. The length of this period is usually 90 days as shown in the policy
schedule. This period means that the insurer must have stayed with the disability for at least 90
days for him or her to get the benefits. If an insurer decides to have a shorter elimination period,
he/she is charged a higher rate. The maximum length of time is 720 days, and the shortest is 30
days. However, although the short period has a high cost, a longer elimination does not save the
insurer as much money due to the risk involved. It is crucial to understand that when the
elimination period is satisfied, actual benefit checks are received at the end of the month (High
Income Protection Insurance, no dates). For a 90 day elimination period, one w...
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