Do you think having a life insurance and a medical/ health insurance is enough to secure your financial stability? No, they aren’t. It’s always better to purchase disability insurance as well. But what is a disability insurance plan and how are they different?
Read on to know everything about disability insurance plans:
A life insurance policy takes care of your family’s financial well being in case of the insurer’s untimely death; a medical insurance takes care of your bills in case of hospitalization and medical expenditures; while a disability insurance takes care of your financial needs in case of loss of job or loss of income arising due to disability caused by an injury or accident. It also covers the medical expenditure incurred in the recovery from the injury or accident.
The basic aim of disability insurance is to provide you with financial aid when you are unable to earn as much money as you used to before. The financial aid is given to help you meet your financial obligations like child’s education, etc. and to maintain your standard of living without any disruptions.
The 3 types of compensations include: 1. Permanent Total Disability cover:
It’s given in case of loss of or impairment of more than one major part of the body (legs, arms, eyes, ears, one leg + one arm, etc.) due to an injury or accident. The entire sum assured or sometimes even a little bit more is given to the insurer in a lump sum.
2. Permanent Partial Disability cover:
It’s given when only one vital part of the body is disabled as a result of which your physical capacity to work is reduced. A percentage of the sum assured is given depending upon the level of loss of income that follows the reduction of working capacity.
3.Temporary or short-term disability cover:
It’s given when the insurer is unable to work due to being absent from work while recovering from the injury or accident. A part of the sum assured is given on a weekly basis only up to a fixed period of time.
By adding riders and add-ons to your life insurance policy, you can enjoy only limited benefits of a disability cover. It’s more beneficial to go for a standalone disability insurance policy.
A comprehensive disability insurance plan might be slightly more expensive but, opting for cheaper options may not allow you to enjoy coverage benefits if the disability is less than 10% or 15%.
It can be an individual policy or a family floater one. Sometimes the latter option can help you get a discount of up to 10% on your premiums.