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Purchasing Disability Insurance: What You Need to Know

June 5, 2017 - in Disability

If you’re a business owner or a salaried person without benefits there are certain liabilities from which you may need to be protected. One of them may be any losses that can result from a disability. If you become sick and unable to work for a long period of time, disability insurance can replace a portion of any income that has been lost during that time if it goes beyond a certain period (usually 90 days).

Disability insurance normally replaces 60% of your income from the previous year until retirement age, but there are certain things that you should consider before you purchase a disability insurance policy.

Should you get an individual policy?

Most companies will offer both short-term and long-term disability insurance policies to their employees, but the question should be whether or not you need an individual plan. If you’re self-employed then you almost certainly need such coverage. But if you work for a company, then your income is an important consideration. If you make more than $200,000 a year, then you should consider getting an individual plan. Otherwise, a group policy through your employer is all you need.

Does it cover your current occupation?

The qualifications for disability insurance will depend on your income, so you need to find out if the policy will cover your current occupation. It might be considered too risky for the insurance company to cover. Certain occupations have specific hazards, and you need to take them into consideration before you decide to purchase a specific policy.

What is your average income?

The amount of disability insurance for which you can qualify will depend on your average income, but the income level of entrepreneurs can vary from one month to another. So, it may be difficult for an insurance company to make this determination. An insurance company may ask you to present your last three tax returns, and it will divide the amount by 36 months to come up with an average monthly income.

What is your current age?

Standard disability insurance cuts off once you’re 65, which is when you can no longer receive coverage. There’s a growing trend of people who are continuing to work over that age, which is a problem if someone in that age group gets injured on the job. There are some companies that offer disability insurance policies for people who are 65 and older, but the policies have certain limitations.

A qualified disability lawyer who can fight for you!

There may be “fine print” issues that people encounter when they file a disability claim. Thus it’s definitely helpful to find legal advice before committing serious money to a policy. Stephen Polak has the experience to make him the right choice for you and he is familiar with the entire Greater Toronto Area. So if you need a Scarborough disability lawyer or one of the best disability lawyers in Markham, his firm has all the tools you need to get the most out of your case. Get in touch with his office to find out how we can help.