Disability Insurance Articles
Three Major Factors In Assessing Disability Insurance Quotes
2010-07-24
One of life's most valuable assets is the ability to earn an income that will provide for the survival needs and the necessities of life. Unfortunately, catastrophic accidents and incapacitating illnesses can occur and result in a consequential disability and the inability to work. Disability insurance is relatively inexpensive-approximately 2% to 3% of the gross income, but will replace roughly 60 percent of that income. As with all insurance policies, there are distinctions and differences that are definitive between a mediocre policy and one that provides excellent coverage. When assessing disability insurance quotes it is critical to consider the stability and sustainability of the company, basic policy features and the company's reputation.
Disability insurance indemnifies the policyholder against financial loss in the event of disability and negative financial consequences due to loss of income. There are many companies that will provide disability insurance quotes, but not all companies perform equally. It is prudent to evaluate the company's financial portfolio and examine its size, assets, loss ratio and the length of time it has been in business. AM Best and the NAIC provide annual reports that give detailed financial information on insurance companies. Recent legislation instituted restrictions on cancellations and rescissions; but it is important to consider the company's practices and protocol before this legislation, including any litigation filed against the insurer. Companies may offer phenomenal plans and coverage, but the question is: Are there sufficient financial resources, revenue, income and residuals to withstand the proverbial test of time, and warrant the faith and implication of trust by the investment of policyholders for future financial security?
Additionally, it is essential to examine the basic coverage offered, including the definition of disability and "work." Does the policy state disability is the inability to perform duties of the indicated profession? Or is there a modification that stipulates that benefits will only be paid if the insured is unable to do any type of work? It is necessary to determine if the policy is non-cancelable and guaranteed renewable if premiums are paid in a timely manner. Another material benefit is the cost of living adjustment rider (COLA), which will increase the monthly benefit to be consistent with inflation. Furthermore, it should include a provision to augment the coverage benefit according to substantial increases in earned income.
Finally, peruse the company Web site and traverse customer comments regarding the company's performance, comments regarding satisfaction with the provided service, or negative comments, especially recommendations to others. Simply asking questions about the coverage and getting candid opinions are beneficial in determining the company's reputation. Disability insurance provides financial security, but policyholders must be aware, informed and discriminating.