When you have been working all your life, and you still have not saved up much to support your family in times of crisis, you might want to consider purchasing disability insurance just in case you are not able to work. If you are working for a company, find out what benefits your employer provides. Most companies have disability insurance for employees who become partially or totally disabled due to work related tasks. However, they might not cover disabilities that occur outside of work. In these cases, you may consider buying a separate disability insurance policy from an insurance company.
When buying from an insurance company, do your research. Make sure you are dealing with a reputable company with a good track record in terms of providing insurance. You do not want to be scammed by a small company that collects insurance premiums only to end up being closed, and you can no longer refund your payments.
In preparation for your purchase of a disability insurance policy, first find out how much you will be needing for a year. Calculate your expenses. Picture a scenario where you are not able to earn income for six months to a year. Consider the things you are willing to forego such as cable TV subscriptions, regular movie dates and unnecessary expenses. Consider your expenses without these, and take note of the amount. Then calculate how much you will be getting from your company if you file for disability. Also check out other benefits from the government such as social security, if it will be available to you. The difference between these amounts will be how much you will need; therefore your additional disability insurance should be able to cover that amount. Now check out several insurance policies and see which will be the best fit.
Make sure you read the fine print of the disability insurance policy. These insurance companies are very specific in the cases in which you can make claims. When filling out the forms and questionnaires, be truthful regarding your health and financial status. The insurance company will assess your health and work background and will form part of their basis for determining your insurance premium. If you choose a policy with higher benefits, you will be paying more. Also check out their payment options, if you can pay monthly, quarterly or semi annually. Usually, you can save some money when you pay semi annually compared to monthly payments. Also find out the waiting period before you can actually claim the benefits in cash.
Before signing the disability insurance policy, read the policy carefully, especially the fine print. Ask whether the insurance company allows for a window in which you can cancel the policy without penalty, in case you want to change your mind. Also check whether you can cancel the policy and refund your payment. Some insurance companies allow this when you have paid for a certain period, but you will only be able to refund a portion of the premium, and not the whole amount that you have paid.