Credit control within the insurance industry is a complex process.
One of the most important is age. The price of a comparable policy can rise by as much as 5 percent each year as you get older.
The cost of disability insurance is usually between one and four percent of your gross annual income. The cost of a policy may vary depending on your personal situation, occupation, and policy choices. Purchasing disability insurance will protect you against unexpected expenses and provide income for up to three years. You should know how much you can afford before buying a policy to avoid being disappointed by a higher premium than you thought possible.
Getting a policy when you’re younger will allow you to get the lowest rates. For example, a policy that pays a $4,300 monthly benefit is cheaper if you’re a young, healthy man.
If you work in a dangerous job or are involved in a risky hobby, you may want to purchase a policy that will pay a lower benefit.
The cost of disability insurance will also depend on your age and occupation. Other factors to consider are the definition of disability and how long the policy will be needed.
You can also choose to exclude some illnesses. Having a chronic illness that requires long-term care may increase the cost of a policy.
Disability insurance is an important investment, but you should not purchase it if you can’t afford it. Getting a policy will save you money on medical expenses and allow you to focus on other aspects of your life. Purchasing disability insurance will protect you if you become incapacitated, or if you’re unable to work for a certain amount of time.
These policies are usually cheaper than individual policies and can be taken with you if you move from one job to another.
Insurers usually offer group disability insurance for their employees. However, the downside to group insurance is that the employer is tied to the policy.
Some states offer higher rates than others, so it's important to shop around before you make a decision.
The length of time between a disability claim and payment is another factor that affects the cost of your policy. Some policies have a waiting period, sometimes referred to as an “elimination period,” during which you’ll not receive benefits. A longer waiting period will lower premium costs, but the downside is that you may miss out on a payment while you’re disabled.