4 Things To Consider When Getting Disability Insurance

Life is unpredictable. The coronavirus pandemic has almost put the world to a halt, and countries worldwide have implemented quarantines and lockdowns. A lot of businesses were also forced to cease operations, and many people have lost their jobs. Situations like this are inevitable, and the best way you can protect yourself is to make sure you and your small business are insured.

Why Choose Disability Insurance for Your Business

Group disability insurance policies can help entrepreneurs in various ways. In general, this policy provides them with peace of mind by guaranteeing that the business can still operate if something happens to them or the economy. Insurance coverage can even extend to the employees.

The benefits depend on the insurance provider and the chosen policy, but, for the most part, disability insurance can cover the business’s expenses, such as rent, utilities, taxes, maintenance, interest on business loans, and employees’ salaries.

Disability does not always refer to injury-caused situations. For example, you can be considered a person with a disability if you become pregnant or get diagnosed with certain conditions, such as a mental health issue or cancer. That is why it is vital to have protection in case unexpected situations like those mentioned occur.

Disability Insurance: What to Consider

Before you purchase group disability insurance for your business, here are the crucial components that you should check:

#1 – Type of Policy

An employer can provide two types of disability insurance programs to their employees: the short-term and the long-term. The difference lies mainly in the benefit period, or the length of time the beneficiary will receive their compensation. Short-term policies can last for three to six months, while long-term coverage can last five years to retirement, depending on the plan you choose.

#2 – How ‘Disability’ Is Defined

Just because a provider offers disability insurance doesn’t mean you should grab a policy right away. You must first ensure that you understand how they define the word ‘disability.’ Review the policy carefully to make sure you know the criteria for disability and the types of benefits you and your employees will get.

Some insurance policies may also change the definition of ‘disability’ after a specific timeframe. For example, an employee may enjoy the benefits of their policy if they can no longer perform their job due to a disability. However, that might no longer be the case after a given period, as the policy will enact a different definition. These little details are crucial to know, as they may affect the type of coverage you can provide to your workers.  

#3 – The Premium to Pay

Every insurance provider offers different types of policies. They vary in terms of the premium amount, whether they have lock-in periods or not, and whether they are under a non-cancelable or guaranteed renewal policy. All these options differ in many ways, so make sure to sift through them and find the policy that suits your business’s and employees’ needs the best. Group disability insurance plans can be covered by the employer alone, the employee, or a combination of both.

#4 – Portability

You also have to decide whether you want to make your employees’ disability insurance portable or not. The majority of employers do not offer portability in their employees’ insurance, but it is still up to what type of policy you want to provide to them.

Conclusion

Unless you have business partners, your business solely depends on you. For situations like now, preparation can be your greatest defense against unpredictable changes. Various insurance providers, like Abbot Benefits Group, can help you identify the right type of insurance for your company requirements. If you want to know how to determine whether a particular disability insurance policy is appropriate for your needs, take note of the enumerated points above.

If you need assistance on what life and disability insurance policy to get for your small and medium company, send us a message today. We are an insurance brokerage firm in Tomball, and we can help you find the appropriate and most beneficial policy for your company. We have been protecting businesses and employees since 1982. Connect with us to learn how we can help you.