Companies have various elimination periods
the period of time after you're sick or injured before benefits begin to accrue.
* Avoid very low deductibles or elimination periods
(EP), since lower deductibles have a much higher premium cost.
One example is the use of shorter elimination periods
(more policy money, quicker).
For example, some policies offer calendar-day elimination periods
, which means the elimination period
starts the day that a doctor assesses cognitive impairment or deficits in activities of daily living.
Benefits included short elimination periods
, high replacement ratios, high maximums, extended own-occupation and specialty definitions, cost-of-living adjustments and so on.
In either case, longer elimination periods
and lower monthly benefit amounts result in reduced premiums.
Shorter elimination periods
typically result in lower policy premiums for disability income policies.
The impact on short-term disability insurance products could be dramatic, depending on the elimination periods
in the policies.
Elimination Period Elimination periods
for long-term care policies affect claims cost in three ways: They reduce total claims paid, they reduce moral hazard since insureds share in the cost of a loss before benefits become payable, and the applicant's choice of elimination period
serves as a signal of riskiness to insurers.
* Recognize that elimination periods
- the number of days you must be in residence in a nursing home before policy benefits begin, for example - can vary, usually from 0 to 100 days.
The amount of years selected for these benefits along with elimination periods
should also be carefully reviewed.
A review of your personal policy should focus on such things as what constitutes a disability and partial disability, accepted causes of disability, waiting or elimination periods
once the disability arises, benefit payment periods, and your responsibility to return to work in some capacity while disabled.