Disability insurance policies are designed to pay part of your wages should you be injured in an accident or are unable to work because of illness. Here are two types of policies available: long-term disability and short-term disability.
Short term disability pays a portion of your wages should you be out of work due to injury for up to one year. Some employers pay for this benefit for their employees, some offer it for employees to purchase.
If you have a pre-existing medical condition, the time to enroll is during the initial enrollment period when a medical exam is not required.
Replacement of wages is only partial; insurance underwriters, as well as your employer, want you back at work as soon as possible. Usually there is a waiting period of 14 days in which you will not receive payment.
Long term disability policies are purchased to replace what your potential earnings would be from the time you become disabled until age 65 when Medicare would be available.
For instance, if you are 55 and make $40,000 per year, you should purchase a policy for $400,000.
You cannot get a long term disability policy if
(1) you are or are soon...
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