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Information about all aspects of finances affected by a serious health condition. Includes income sources such as work, investments, and private and government disability programs, and expenses such as medical bills, and how to deal with financial problems.
Information about all aspects of health care from choosing a doctor and treatment, staying safe in a hospital, to end of life care. Includes how to obtain, choose and maximize health insurance policies.
Answers to your practical questions such as how to travel safely despite your health condition, how to avoid getting infected by a pet, and what to say or not say to an insurance company.

Disability Insurance: Long Term: Individual


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When purchasing or qualifying for a Disability Insurance policy, keep in mind that there is no such thing as a standard Disability Insurance policy.

An individual long term disability insurance policy can be difficult to get post diagnosis. The longer you wait after an acute episode, the more likelihood you will be able to get a disability income policy. As a general matter, these individual policies are not available to people who have had any medical treatment during the past 7 - 10 years for a potentially disabling medical condition. To learn what may be available in your state, contact an experienced insurance broker. You do not have to disclose your name. The broker can find what is available for an anonymous client with your medical history.

If you are able to obtain an individual policy, it will likely be "rated" - you will be charged more than a person without a health history, and/or the policy may exclude coverage for your health condition.

When you apply for an individual disability policy, you will likely be asked to take a physical exam. You will also have to complete an application which requests your current and past health condition. While a policy may have a "contestable" clause which provides that the existence of the policy cannot be contested after a period of time, you cannot rely on this provision if you lie about your health condition on the application.

Following are the basic features to note:

  • Cost.
  • Pre-Existing Condition Provisions.
  • Definition of "Total Disability".
  • Whether the policy covers "partial disability" (also known as "Residual Benefits").
  • The length of time from the disabling moment until payments begin (known as the "Elimination" or "Waiting" period).
  • The benefit amount, and maximum period during which it is paid.
  • What happens if you return to work and become disabled again.
  • Survivor Benefits.
  • Recurring Disabilities Provision.
  • Mental and Nervous Limitation.
  • Other Exclusions and Limitations.
  • The type of individual disability insurance policy. The most common are known as "Guaranteed Renewable" and "Noncancellable."
  • Waiver of Premium.
  • Renewal Terms.

Whether or not your benefits are taxed depends on how the premiums were paid. Either the premium or the benefits will be taxed, but not both.

If you are interested in purchasing an individual policy, also read: Disability Insurance: Individual: Things To Think About When Purchasing.

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