What to Expect When Applying for Long-Term Disability Income Insurance

Long-term disability income insurance ranges in how long it will cover an individual. Someone can purchase this type of disability income insurance for as little as one year; however, it can cover someone until age 67. Ideally, a person should consider purchasing this type of insurance while they’re young because it’s less expensive. The older a person is the more expensive it is. 

While applying, remember that disability income insurance is not designed to pay for doctors, hospitals, and other medical expenses. Rather, it is about insuring a person’s income. It’s meant to provide up to 60-70% of a someone’s taxable income if they are ever disabled. As this type of policy insures income, the application process looks at one, maybe two, years of tax returns to confirm a person’s income. Plus, the application involves a paramed exam.

Helpful Tip: schedule a paramed exam in the morning. Not only will you not have to skip meals throughout the day in preparation, but your blood pressure is usually better in the morning.

Because long-term disability income insurance evaluates an applicant’s health and finances, the underwriting process takes awhile. It’s not like a simplified-issue disability income plan, which only asks a few questions before issuing the policy. Instead, long-term disability income policies go through a thorough underwriting process. The insurance company, in addition to the paramed exam, researches medical records and other information from doctors. This can take about four weeks, if not longer.

Lastly, it’s important to apply for disability income insurance for one’s own occupation if they specialize in a particular field. If not, then the policy may not pay out if they’re disabled but can still get a job. A veterinarian, who, for instance, specializes in horses, should make sure the policy covers their specific occupation. Otherwise, if they’re disabled and can’t work with horses, they may be expected to work with other animals if they’re able. 

Since insurance is oftentimes overwhelmingly confusing, we want to shed light on this industry by answering YOUR questions.  So if you have any questions or concerns, comment below and your question may be the topic of our next video!

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