Disability Insurance: Key Terms to Understand

Disability insurance is a vital component of financial security, ensuring that you are protected if an illness or injury prevents you from working. However, as life circumstances change, it’s crucial to revisit your policy to ensure it still meets your needs. Below are key terms and concepts to consider when reviewing your disability insurance policy.



Occupation Definition of Disability

• What It Means: The definition of disability in your policy should accurately reflect your specific occupation and its associated risks.
• Why It Matters: A policy tailored to your precise line of work ensures that you receive the appropriate benefits if you cannot perform your job duties due to a disability. This is especially important for professions with unique physical or cognitive demands.

Loss of Time

• What It Means: Some policies include clauses that recognize "loss of time" as a qualifying factor for disability benefits.
• Why It Matters: This provision can offer benefits if you are unable to perform your usual work hours or duties, even if you are still able to work in a limited capacity. This flexibility can be crucial for maintaining financial stability during periods of partial disability.

Coverage Amount vs. Income

• What It Means: This refers to the alignment between your current income and the amount of disability coverage you have.
• Why It Matters: If your income has increased significantly since you first took out your policy, it’s important to adjust your coverage. For example, earning $300,000 annually but only having $180,000 in disability coverage could leave you financially vulnerable if you become unable to work. Updating your coverage ensures that your benefits match your current earnings, providing better financial protection.

Your income-producing power is your greatest asset, and ensuring your disability insurance policy is up-to-date is an essential part of protecting it. Contact Standard Equity today to review your disability insurance and ensure your coverage is aligned with your current financial situation.