Disability Insurance: Will You Collect?

Disability insurance is perhaps the most fickle of all the different types of insurance in terms of being able to collect for your ailment in a timely fashion because there just seems to be too many exclusions or fine print. However, if you tread carefully and follow our simple steps, you will be on the road to collecting on your claim everytime.

Verify the definition of disability. When analyzing your disability insurance, it’s very important to understand the fine print of the contract. Unlike life insurance, there is much more grey area surrounding what qualifies as a claim. The definition of disability used in a disability contract can have a direct impact on the insured’s ability to collect when he/she needs the money most. “Any Occupation” is the least favourable definition of disability. Under this definition, total disability means the inability to work at any occupation. Therefore, if your disability makes you unable to work at your regular occupation, but it isn’t enough to prevent you from gainfully working anywhere else, you will not receive a cent. For more details, click here.
Look into any exclusion on the policy. Most disability policies will include exclusions for pre-existing conditions. i.e., If the insured just broke his/her leg, the insurance company will cover every disability except those related to a re-injuring of the leg.
Verify if your plan only covers injury related disabilities. There are policies which cover both illness and injury related disabilities, but there are also Injury-Only policies, which cover disabilities just related to injuries. The World Health Organization estimates that of the 600 million people living on this planet with disabilities, 25% have disabilities caused by injury, while the rest have disability due to illness. Since injury-related disabilities make up a smaller percentage, the premiums are generally much cheaper than policies that include potential disabilities caused by illness.
Make sure you are dealing with a reputable company. An insurance policy is a promise to pay, so make sure you are dealing with a reputable company.
Verify if the plan is non-cancelable or non-renewable. Non-cancelable disability plans offer more complete protection because the plans can only be cancelled by the insured. Guaranteed Renewable plans can have the rates adjusted or the coverage cancelled by the insurance company on a class-wide basis.
Make sure you have a reputable broker who is going to be able to assist with the claims paying process. We will never make any promises that we can’t deliver — it’s the LSM difference.