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Comparing Disability Income Policies
What to consider when comparing disability income insurance policies.
Different disability income insurance policies offer different benefits. To make sure you have the coverage and flexibility you need, compare the following key elements when considering disability income insurance policies.
Renewability. Two of the most popular individual disability income insurance policies are non-cancelable and guaranteed renewable:
- Premiums on a non-cancelable policy are guaranteed until age 65.
- Premiums on a guaranteed renewable policy can be changed at any age on a class basis with state approval.
Waiver of premium. After 90 days, all premiums due during total or partial disability will be waived. Premiums paid during the 90 days will be refunded.
Rehabilitation. While continuing to pay a disability benefit, the insurance company pays the costs of a rehabilitation program that can help you return to full-time work.
Ten-day free look. You have 10 days after receiving the policy to examine it and return it to the financial professional or insurance company if not satisfied. All premiums paid are refunded.
Recurrent disability. If a disability due to the same or related causes occurs within 12 months of a prior disability, it may be considered a continuation of the earlier disability, even if the elimination period has not been satisfied.
Continuation beyond age 65. As long as you are employed full-time (defined as 30 hours per week) after age 65, the policy will continue. Some companies allow continuance to a certain age (i.e., 70, 72 or 75) while others allow a policy to be continued indefinitely with your employment. Premiums will be based on attained age.
Grace period. You can pay any premium within 31 days after its due date, during which time the policy stays in force.
Contestability. After the policy has been in force for two or three years (sometimes excluding periods of disability), the company cannot contest the policy except for fraudulent misrepresentation.
Elimination period. The period of time you must be disabled before you become eligible for disability benefits. This period may be met with non-consecutive or consecutive days of disability.
All guarantees are provided by the financial strength and continued claims-paying ability of RiverSource Life Insurance Company and in New York, by RiverSource Life Insurance Co. of New York.
RiverSource Distributors, Inc. (Distributor), Member FINRA. Insurance and annuity products are issued by RiverSource Life Insurance Company and in New York, by RiverSource Life Insurance Co. of New York, Albany, New York. These companies are affiliated with Ameriprise Financial Services, Inc. Only RiverSource Life Insurance Co. of New York is authorized to sell insurance and annuities in New York.