A term life insurance policy offers financial protection to the policyholder for a particular period, say 5 to 30 years. If a policyholder passes away during the policy term, the policy pays out the death benefits to their dependents/beneficiaries. However, does it cover disability? Read on to find out.
It doesn’t cover disability resulting from any accident/illness. Nevertheless, you can buy additional endorsements to replace some of your lost income when you are unable to work due to a physical impairment.
To stay covered against disabilities, you can consider customizing your existing term life insurance policy with any of the following riders:
If you fulfill the eligibility criteria of disability (like what the insurance company considers as disability), you can keep your coverage active without paying premiums.
Provides 1% of your policy value as a monthly income benefit if you are disabled. For example, if your policy’s worth is one million dollars, you will probably receive $1000/month.
Allows you to use a part of your death benefit amount if you are diagnosed with an end-stage disease/illness.
You never know what life has in store for you. If unfortunately, you meet with an accident that limits your physical abilities, your family may find it difficult to manage all the expenses. Adding disability coverage to your existing life insurance policy is vital to stay better prepared for future uncertainties.
A disability insurance rider is crucial if you:
Besides term life insurance with disability coverage, the following policies can also cover disability
It provides 60-80% of your monthly income if you cannot return to work for the time being due to:
If you cannot work due to an injury or illness resulting in a prolonged disability, long-term disability insurance provides 60% of your monthly income (deducting tax) for anywhere between 24 months to your retirement age.
A long-term disability policy covers conditions such as:
Your employer will cover your medical expenses and disability benefits if you are injured or become ill at work.
The benefits received from workers’ compensation insurance and individual disability insurance are not taxable, but the payouts from any pension plan are taxable.
It depends on your monthly expenses, outstanding debts, and income from other sources. However, having disability coverage that covers 60-70% of your pre-disability salary is recommended.
If you are looking for comprehensive term life insurance with disability coverage in New York and surrounding areas, contact us today at Kneller Insurance Agency. We will assist you to find the right policy with all-inclusive coverage at an affordable cost.