California Disability Insurance

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California Disability Insurance
California Disability Insurance

The American Council of Life Insurers states that fully one-third of all Americans aged 35 to 55 will become disabled for a period extending beyond 90 days. Further, disabilities that extend beyond 90 days will typically run into a length measured in years…and the most common cause of disability is not injury or some freak occurrence, but rather, illness…

Life can change quickly and the plans you make today to protect the wealth and assets you and your family have accumulated over the course of time will be vital in protecting the lifestyle you and your family enjoy. In a situation where a disability occurs, be it from injury or illness, you’ll want to be able to rely on the strength of your independent California health insurance broker and the insurance company you selected as your California disability insurance carrier to help you through in a time of need. We are confident that we offer that strength, and we further believe our independence and the ability to offer you a broad range of options related to your choice of California disability insurance plans is further testament to our array of strengths. At Vitality we are a strong believer that we are best able to fulfill our promise to you in finding the best plan at the most affordable price if we offer disability plans from an array of insurance carriers. In line with that philosophy, you can expect your Vitality professional to offer you plan options from California disability insurance leaders such as Principal Life Insurance Company, MetLife, Mutual of Omaha, Assurity, and Union Central.

As with all our product offerings, our careful, considerate consultation with you the client is completely free. As an independent California health insurance broker our services are paid by the company whom you choose to cover your insurance needs. We represent not only a cost efficient insurance shopping solution; we represent trust and freedom of choice in a California disability insurance broker who is there each and every step of the way throughout the plan comparison and selection process and who will be there long after whenever you need us.

We know that for the vast majority of California residents, the thought of adding another insurance policy like a California disability insurance plan to your financial preparations might be a nonstarter. Family budgets being what they are these days we understand that contemplating a crippling financial hardship through illness or injury and making missing work and regular paychecks a likely scenario is a thought process most, if not all of us, want to push from our minds and move on to more immediate thoughts of making this month’s family or small business budget do “what it needs to do”.

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We completely understand that the demands placed on your family or small business budget are such that you count yourselves amongst the fortunate few that you have secured adequate California health insurance and California term life insurance to care for your family’s health needs and future security in the event of your untimely death. Contemplating the addition of a private disability insurance plan via a California disability insurance policy is a seeming “luxury item” your current budget won’t allow and yet the subtle pull of this product and the logic behind it presents itself at times when a media story or even closer news of a family member or acquaintance where finances have been devastated – perhaps irrevocably – by illness or accident and the lack of adequate short term disability coverage, can provide a stark and uncomfortable reminder of our financial vulnerability without a reliable product like California disability insurance .

As owners of a small California business we’re right there with you: We know firsthand that the more immediate responsibility to meet a monthly household budget can affect or eliminate the luxury of long term strategic planning of the kind that goes into contemplating a California disability insurance policy. We’re also keenly aware that the business of small business owners is: Business! It is difficult to take the long view and contemplate the pluses and minuses of a disability income policy during the course of a harried work week, where generating new business and servicing existing clients is of paramount importance. Besides – in a world where negative thoughts are easy to come by (!), do we really want to think about the possibility of illness or injury depriving us of our livelihood? Not particularly!Â

Perhaps the immediate reaction of the insurance consumer is “How much insurance does a person need, anyway?” when contemplating the viability of adding a California disability income insurance policy. Well, let’s look at the numbers: The Social Security Administration estimates that 3 out of 10 twenty-year olds will become disabled prior to retirement age. While that’s not “90% I gotta’ have California disability income insurance right now!” territory, it’s not struck by lightning, winning the lottery range either! And this is one lottery you don’t want to win: Imagine just for a moment missing two paychecks next month. One word: Scary. Now: Think about losing your paycheck for the next several months – and paying for California health insurance coinsurance costs at the same time! This is where the peace of mind that California disability income insurance comes through loud and clear to make this the one right insurance addition you can make to your financial protection plan this year.

But you know what? That might not be the right way to consider this insurance product. No one wants to make a decision borne of fear. Instead, let’s look at this more analytically and in light of another insurance product that should already be in your possession: The California term life insurance policy. It’s been said that the purchase of a California term life insurance policy can be the purchase of an “instant estate”. Let’s look at a simple example of that: The policyholder wants to leave his family an estate of $750,000 to pay off a mortgage and provide financial support for his young family in the event of his untimely death. Could the average middle class policyholder have achieved – even through aggressive saving and investing strategies – a nest egg of $750,000 to leave behind for his family? Not likely! Instead, the policyholder created the opportunity for an instant estate with the prudent purchase of a California term life insurance policy at substantially less cost than that of a savings program.

Now please don’t get us wrong: A family savings program is vitally important and necessary. A family savings program is necessary to building long term wealth, sound retirement planning, college funding, and future housing needs. The fact of the matter is that the strategy most people have for paying for a period of disability, lost wages, and sudden unexpected medical expenses is the “emergency fund”: For those of you reading this Web page, please raise your hand if you agree that the item in your monthly family budgeting meetings that always takes it on the chin is contributions to the emergency fund. With the prudent purchase of a California disability income insurance policy you have just secured an area of your long term financial strategy that would have otherwise slashed through your emergency fund and then made its way into funds earmarked for the long term goals we mentioned above such as retirement, college savings, future real estate and the ideal of a secure future without worry.

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If you’ve decided that California disability insurance is the right move at the right time to make now, the next step in the process is gaining an understanding of how disability insurance in California might work for you including disability insurance cost:

Well it really all starts with these two criteria: What is the level of your disability as it pertains to you doing your job and what your level of “disability” is. They will want to know whether it is possible for you to do your job in this disabled state or if the nature of your work precludes doing it even with a partial disability or: Are you completely incapable of doing any work of any nature?  Are you partially disabled? Completely disabled? You’ll want to understand what criteria the insurance company is going to use before they rule that you’re are eligible under the terms of your California disability insurance policy. Â
Do you qualify for residual benefits? Let’s say you can do some of your job but by doing some of your original work you are only making a portion of your pre-illness/pre-injury income level. Does your California disability insurance policy offset some of that lost income with either a built in feature to the policy on this subject or as a rider that you paid additionally for?
There are also presumptive disabilities such as the loss on eye, a limb, speech so even if you return to your former occupation post-loss you are still eligible for disability payments or lump sum payouts.
Welcome to the mind of an insurance company: Let’s say you are disabled and the insurance company makes arrangements to begin paying on your California disability insurance: You will likely only receive a portion of your earned income pre-disability. Perhaps in the maximum range of 70% or so. The reason? The insurance company wants to incentivize your willingness to return to work so you can get back to the business of earning a “full paycheck” again rather than continuing to collect on your California disability insurance.
Your premium costs will be impacted by such variables as when you want to start receiving your benefits if ruled eligible to receive them. In this variable the longer you can wait to receive your California disability insurance the lower your premium. Have you got the kind of emergency fund or other financial resources that would let you wait 90 days or perhaps upwards of 180 days to start receiving a California disability insurance check from your insurer? Or: Would you need to start receiving a check immediately?
Another variable in this equation is the length of time you wish to receive your California disability insurance benefits? Is the period of time you have in mind one year, two years, five years, up to age 65, a lifetime? Again, lots of variables that need review and consultation between you and your California disability insurance professional.
A vital rider offering is a cost-of-living feature to your policy. You’ll have to decide whether or not you opt for this very important feature which will stave off the negative effect of inflation on your California disability insurance benefits. This rider option can be especially vital within the context of a lifetime California disability benefit payout as it will be added insurance that you and your family would be able to approach and maintain your current needs for an extensive period of time.
As with all California insurance policies one of the most important features that will be left for you to research in the policies under your review is their renewability. Will they be non-cancelable or guaranteed renewable? Non-cancelable is, as the name implies, your policy to keep as long as you make on time premium payments. On the other hand, while guaranteed renewable California disability insurance is guaranteed to be renewed by your insurer, premium rates can be adjusted upward if done so for an entire class of policyholders – i.e. all insured in one state. Other options available to insurance companies include optionally renewable or conditionally renewable policies that are cancelable if cancelled for an entire class of policyholders such as ones in a particular geographical area or location.

A California disability insurance plus? Make the payments as an individual and you would likely be eligible to receive your benefits tax-free. As we discussed the need for small business owners to seriously consider the merits of a California disability insurance policy earlier we should also mention that certain policies feature distinct benefits tailored to the unique needs of such businesspeople. Benefits to business owners can include: Payments that are made even after you return to work but are there as a backstop as you rebuild a client list; expenses paid for certain business expenditures. Check with your California disability insurance professional here at Vitality and learn how protection for even short term disability can be an important strategy for the financial health of your family and your business! We’ll also review your current employment benefits with you to see if an employment disability plan is part of your benefits package!