Disability Coverage Vs Critical Illness Plans| Jan162011
critical illness disability insurance coverage may seem similar, but there are many differences in the two forms of coverage. Disability insurance has many guidelines about their payouts that may cause you to be ineligible for a payout even if you are deemed disabled. Critical illness insurance has its own guidelines which are much less stringent and can be used toward many health problems, even those that would cause you to be disabled. The facts will be laid out here for you to learn about these two insurance types and allow you to make a well-informed decision about you and your family’s future and welfare.
Disability insurance is an insurance policy that should protect you in case you become disabled. The claimed disability cannot result from a pre-existing chronic illness. Some policies cover disability that occurs due to an injury at work as well as anywhere else, while some policies only cover one or the other. Depending on the policy, the payout may be held for up to a year to keep the cost of the premium low. This means that if you are disabled for a span of time shorter than the time you’d have to wait for a payout, you will not receive any benefit for that claim. If the incident that causes the disability can be covered by another type of insurance policy that you have, you may only receive coverage for the costs that the other insurance type will not cover. Many times, only a percentage of your income will be provided to you in a qualifying claim. Disability coverage does not cover you indefinitely, either—there is a cap. In addition, some policies only cover complete disability. In the end, it boils down to an old saying, “buyer beware.”
critical illness disability insurance covers health problems medical experts define as critical such as cancer, stroke, and Alzheimer’s disease. Some of the issues critical illness insurance covers result in disability. It does not matter where or how you happened upon the critical illness as long as you are diagnosed as critically ill. Sometimes critical illness coverage requires you to survive a certain number of days, usually about one month. The required survival time is shorter than most disability insurance companies require. You would receive a payout regardless of any other insurance payouts you may receive from other types of policies you hold. There is no cap for coverage with critical illness insurance as you are paid in a lump sum.
Both forms of insurance have overlapping properties and similarities. They have some very important differences as well. Disability insurance is full of potholes and may not payout when you need it most. critical illness disability insurance can protect you in many cases of disability and the plans are much simpler to navigate. You won’t have to worry about caps, other types of insurance policies you hold, or and how much you receive is from your lump sum is up to you—no percentages. It is wise to choose critical illness insurance, even if just to complement your disability insurance. Choose to provide protection where disability insurance alone cannot.