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The Importance of Reviewing Disability Insurance Coverage

The Importance of Reviewing Disability Insurance Coverage

May 23, 2023

May is Disability Insurance Awareness Month, a time dedicated to raising awareness about the importance of disability insurance and the financial protection it provides. 

While many recognize the significance of disability insurance, some treat it as a “set it and forget it” type of insurance. If you already have coverage, you’ve done a great job taking big steps towards protecting your income. A quick annual review of your policy will ensure your policy reflects your wants and needs, and Disability Insurance Awareness Month is a great time to do it. 

Understanding Disability Insurance

Disability insurance is designed to provide financial protection in the event that you become disabled and are unable to work. It acts as a safety net, replacing a portion of your income if you are unable to earn due to a disability. This insurance coverage is particularly important for individuals who rely on their income to support themselves and their families.

Why Reviewing Disability Insurance Coverage is Important:

General Policy Information: 

  • Keeping your policy information up to date is important for billing and claim purposes. If you’ve moved or changed email addresses, you should let your insurance company know in case they need to update things on their end.

Changes in Income:

  • If your financial obligations decrease, you may consider adjusting your benefits to avoid overpaying for unnecessary protection. As your income grows or your financial responsibilities change, you may need to increase your coverage limits. Most people are eligible for disability insurance benefits up to 2/3rds of their income. You may be able to increase your benefits within your existing policy, or add an additional policy to get more coverage. 

Benefit Increases:

  • Expanding on the previous point - if your existing disability insurance policy includes a benefit update or increase rider, you may be able to add to your coverage without medical underwriting. With Automatic Increase Riders, your coverage will increase at set intervals to help combat inflation and the cost of living. Other benefit update riders will ask for a brief application and proof of income. Your insurance agent can help you navigate what options you have to add to your coverage. 

Changes in Health and Lifestyle:

  • Health conditions and lifestyle choices can influence your disability insurance needs. If your disability insurance policy has an exclusion due to a previous medical condition and that condition has resolved or improved, you may be able to get it removed. Exclusion removals generally require a benefit change application and medical proof of your improved condition. Additionally, if you have quit using tobacco since you first applied for your policy, you may be eligible for less expensive benefits.

Peace of Mind:

  • Reviewing your disability insurance coverage provides peace of mind. Knowing that you have a robust insurance policy that adequately safeguards your income and financial well-being can alleviate anxiety and worry. By taking the time to review your coverage during Disability Insurance Awareness Month, you are proactively managing your financial risks and ensuring that you are prepared for unforeseen circumstances.

Contact us today for a review of your existing policy or for disability insurance quotes. We work with all major disability insurance companies to provide quote comparisons so you can get the best coverage available. Get your quote today.