Long Term Disability Insurance

Parent Cafe
1

<p>I am self employed and have never really seen the need for disability insurance, since my husband has been the primary breadwinner and I worked only part time when my children were young.</p>

<p>Now that they are older, I am working significantly more, and contributing a lot more money to the household. We already have one private school tuition, and a college tuition looming. Suddenly, the thought of losing my income, in the event of illness or injury, is worrisome.</p>

<p>Anyone know the best way, rate, etc to go about getting disability insurance? Through whom? Do I just compare rates through insurance companies, look for a group (AARP, for example, gasp) or something else? I don’t even know what to reasonably expect to pay.</p>

<p>Thanks in advance for any advice.</p>

2

<p>We purchased through an agent who presented us with several alternatives. We chose GE, which is now Genworth. Because my wife and I both have defined pensions, which increase with inflation, we only bought policies which paid $100.00 per day. That figure will also increase with inflation. It was expensive for us since I was almost 60 when we bought. The younger you are the cheaper it will be, but the longer you will pay. </p>

<p>I think you are doing the right thing in looking at this. My father died the month his money ran out. My wife and I do not want to pose a similar threat to our only child.</p>

3

<p>I got mine through the State bar association. If you have a membership in a professional organization, you might check to see if they offer plans at discounted rates, etc. I have a plan through Guardian and a smaller one through Provident. I believe the Guardian one is better. I am underinsured based upon my annual income, like tsdad, for similar reasons. I do like the peace of mind it gives me, though, to get me from any time from now until retirement age in case something happens that prevents me from working.</p>

4

<p>We have personal policies through Northwestern Mutual–just another one for you to check. If you have a financial adviser/planner, I would ask them to do a search for you and see what fits your needs the best.</p>

5

<p>I have Northwestern, too. I first bought it when I was in my 20s and the only breadwinner.</p>

<p>One of the big issues is how long you are willing to wait before the policy kicks in. A six-month waiting period costs a lot less than a 30- or 90-day waiting period.</p>

6

<p>Second tsdad’s advice to work with an agent. We went with MetLife after comparing various products and running the cost/benefit numbers.</p>

7

<p>Ask if the policy pays only if you are fully disabled and unable to perform any kind of work (cheaper because that is less likely to happen) or just unable to perform the line of work you are currently engaged in (more expensive but for many people much better). The more narrowly defined the type of work being insured the more expensive the policy. I have a policy that I have kept in effect from nearly 20 years ago that will pay something if I am unable to continue to practice my surgical specialty. It is easy to envision a disability that could result in that happening. But, if I didn’t have that clause in the policy, the insurance company could say that I can retrain in another specialty (at great expense and time) or that I was able to get a job as a janitor, check out clerk at Safeway, etc., and therefore they were not going to pay out anything. Obviously I would not be insuring against much in that case. Whether you want that provision depends on what you are doing now and what you want to insure against.</p>

8

<p>Revere disablity insurance (now merged as Revere-Provident-Unum) was aggressively marketed to physicians by the AMA. As physicians have since learned, Provident perhaps did not live up to its obligations. A class action suit for inappropriately denied claims was settled by UnumProvident in 2004.</p>

<p>See the Physicians News Digest article at: <a href=“http://www.physiciansnews.com/cover/102.html[/url]”>http://www.physiciansnews.com/cover/102.html&lt;/a&gt;&lt;/p&gt;

<p>The settlement details: <a href=“http://www.unumprovidentclassaction.net/news2.html[/url]”>http://www.unumprovidentclassaction.net/news2.html&lt;/a&gt;&lt;/p&gt;

9

<p>Isn’t managed care wonderful:</p>

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10

<p>First let’s make sure you’re seeking income protection and not long term care. I think a couple of posters here have confused the issue. </p>

<p>With any insurance contract read the definitions. What has to happen before I get a check? Doctors care? Hospitalization? Hospital admitance? Is there a pattern that must be followed. How do they treat reacurring illness? Do you start over or does it extend? </p>

<p>What defines disability? As one said the narrower the scope in relation to your profession is the best and also most expensive. The broadest definition (any occupation) is the worst. Be aware of any time periods where one definition changes to another. Often a policy may start out with OWN OCC. (best def possible) and after two years swith to ANY OCC., this could mean the policy ends payments at that time. </p>

<p>Mental health issues can always be a factor to consider too. Most group policies have an opt out after two years for mental health issues. Hypertension is a disease which can be brought on by stress which is a mental condition. Which happened first? </p>

<p>Read, read, read these policies and play what if. If price is your biggest concern always be aware that cheap policies offer cheap coverage, with disability insurance you do pay for what you get. </p>

<p>Look for OWN OCC (OCCUPATION), NON CAN, GAR RENEW. This means the best definition, can’t be cancelled and has to be renewed. For these three things expect to pay. </p>

<p>Be aware some occupations will never have more than 2 years (or 5years) own occ, because of risk factors. With those type of policies you have to decide if paying a premium beyond those own occ years is worth it to you. </p>

<p>I too have had my policies for around 20 years. They don’t sell what I have anymore, but they can’t cancel it either. I’ve used it once for the months I was laid up with a back problem. They work the way they are supposed to if you know what the definitions are. </p>

<p>Just remember with disability coverage…if it’s really cheap you may be paying for something that when you really need it… still doesn’t meet it’s requirements to pay. Was saving on the premium worth it? </p>

<p>Long term Care is another issue. If that’s what you’re really talking about I point out some things there.</p>

11

<p>Good point. I recently reviewed mine with my agent as I was beginning to consider long term care insurance. Mine does provide coverage to age 65 in my own occupation (the Guardian one does, not sure about Provident). I think that Guardian is much better than Provident. </p>

<p>There was a helpful article about long term care insurance in the subscriber portion of consumerreports.com, which made me reconsider purchasing it now. If you are subscriber, do a search on consumer reports for the information. </p>

<p>I too had to make a claim on the Provident plan about 20 years ago for about 6 months, for a high risk pregnancy. After the 30 day waiting period, it was actually quite helpful to have.</p>

12

<p>Yikes, Opie.</p>

<p>Reading your post makes my head spin. This is what I can’t stand about the insurance industry. Nothing is clearly deliniated; everything is convoluted.</p>

<p>Now I am good and confused, and have done nothing about actually <em>getting</em> a policy since I posted this, since all the website reading I have done spins my head the way that Opie’s post did.</p>

<p>I think I know what I need (I think)…shouldn’t be that hard to figure out how to get it. Alas.</p>

13

<p>Opie is right. I confused two things. I was talking about long term health care insurance not disability. I don’t really need the latter because my wife and I are already receiving enough in pensions so that we don’t have to worry about becoming unable to work. Heck the only way I could become disabled in my current job is to fall off my chair.</p>

<p>Sorry for misleading the OP.</p>

14

<p>If you lost your income, would the short fall be partially offset by an increase in need based aid?</p>

<p>For this reason and others, my wife and I are more worried about long term health care insurance.</p>

15

<p>I looked into long term care insurance this year because I know that the cost of the insurance premiums is lower if you purchase it if you are younger. The “deluxe” policies I was looking at were exorbitant and so I didn’t go any further for now. As with Opie’s good post, with long term care insurance there are lots of variables, including length of exclusionary periods, what type of care is covered (e.g. is home care included), of course what level of benefit is provided, etc. </p>

<p>I do recommend reading about this before buying anything. If you go to consumerreports.org and search for long term care insurance, there is a cautionary article there (but you may have to subscribe to read it). One of their points was that in most cases, people will not need long-term care for years. Unfortunately my mom was one of those who did, for 9 years. So in that situation, the insurance would be well worth it on all counts–for conserving a person’s estate, for the peace of mind to relatives that good care can be afforded (many nursing homes and similar places do not accept patients who cannot afford to pay or who are on Medicaid). </p>

<p>I believe they said that people usually buy this in their 60s. Definitely look into it but do some reading first.</p>

<p>Remember that insurance agents make their living by receiving fees for the policies they sell; so I don’t completely trust their recommendations. AARP may have unbiased information as well.</p>

16

<p>Sorry to cause distress. Yes, I’m in that business, so I know how it can be. Most people don’t want to know and focus on price at the expense of what they’re really buying. With both disability and LTC that can be critical.</p>

<p>Before you buy anything with insurance, find out what exclusions are present. Use a note pad, make examples of situations and how that would play out. ASK the agent to show you how their explaination would work within the policy it self. There is usually more reading material available to choke a horse. Take notes, keep notes with the policy you buy. </p>

<p>An insurance carrier lays out a policy based on risk and prices it accordingly. Always suspect a cheaper than cheap policy compared to others with same features. It doesn’t mean don’t buy it, it means find out why there’s a difference. Then if you can live with that difference you’ve made a wise purchase. There are very few bad policies out there, just alot of misapplications. It’s like wanting a dog from the pet store but bringing home a goldfish. The goldfish in itself is just fine, it will do what goldfish do. However, if you wanted a pet to get the paper, not so much. People often buy policies they “think” will do a certain thing, yet there inwriting is the exclusion. Read, paperclip, dogear, highlight what ever you need to do, but do it. This is the kind of stuff we tell our kids to do, but fail to do it ourselves. </p>

<p>I tend to sell from the +/- side of things. Here’s the good qualities, here’s the not so good qualities to every policy of any type written. Is there anything in the not so good that you can’t deal with? It is always important to know what a policy (any kind) doesn’t do. It then depends if that still works for you. </p>

<p>I’ll review my notes on LTC and post another time very soon.</p>

17

<p>Opie–can we buy it from you? It sounds like you are the person we need!! You’re kind to give this information.</p>

18

<p>Thanks Opie. I am sitting on hold as I type this (gotta love “hold” with insurance companies).</p>

19

<p>“Opie–can we buy it from you? It sounds like you are the person we need!! You’re kind to give this information”</p>

<p>thank you that’s very nice and a boost for my day. But no, I am more than willing to answer a question you might have, I would be uncomfortable doing any type of “selling” via this forum or anything else I voluntarily participate in. Not to say that would be wrong, but it’s just not me. </p>

<p>But thank you, it’s a nice way to start a Monday.</p>

20

<p>I recently joined the IEEE to take advantage of their member benefits such as Long Term Disability Insurance. Check out their website:</p>

<p><a href=“http://www.ieee.org%5B/url%5D”>www.ieee.org</a></p>

<p>You do not have to be an engineer to join. LTD is administered by a 3rd party insurance company. Goto member benefits to look at what they offer for members of IEEE.</p>