Elimination period

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Elimination Period

In disability income insurance or loss of income insurance, the period of time that must transpire before the insurer begins to make payments covering the claim. That is, if one suffers an injury or a long term illness that results in substantial loss of income, the insurance policy sets an elimination period, at least in part to ensure that the disability or sickness is in fact long-term. The elimination period is often thought of as the deductible for disability and loss of income insurance as the policyholder is responsible for expenses incurred during it. For the disability income insurance run by the Social Security Administration, the elimination period is five months. Private plans often include 90-day periods, or shorter periods in exchange for higher premiums.

Elimination period.

If you have disability insurance or long-term care insurance, there's a waiting period, called the elimination period, from the time you become disabled, or are certified in need of long-term care, and when you begin receiving benefits.

You often have a choice of elimination periods -- such as 30, 60, or 90 days -- when you purchase the insurance, though sometimes the payment gap is dictated by the terms of the policy.

In general, the shorter the elimination period the higher the premiums will be for comparable coverage.

References in periodicals archive ?
62% of the policyholders without inflation protection have policies with no elimination periods.
The longer elimination periods and/or lesser payout periods have a lower premium.
The cost is higher for shorter elimination periods because insurers will not just pay out more claim dollars but also see more claims incurring during this time period.
An aggregate benefit policy and a non-aggregate policy issued for like amounts, with elimination periods being identical, not withstanding any variations in the policy provisions themselves, might pay identical benefit amounts on the first claim.
The researchers also looked at the effects of LTD policy elimination periods -- the gap in time between the day a covered worker becomes disabled and the day the worker can collect LTD benefits.
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.
Elimination periods may vary from a month or less, for short-term disability coverage of an illness, but not an accident, up to longer periods such as 60, 90, 180, or 365 days for a long-term policy.
An individual disability income policy will typically offer the purchaser a choice of several elimination periods at the time the policy is purchased.

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