Disability Insurance FAQs

1. What is disability insurance?

Disability insurance replaces a portion of your income if you become unable to work due to illness or injury. It helps you cover essential expenses like housing, groceries, and medical bills while you recover.

2. How much of my income will disability insurance replace?

Most policies replace 40%–70% of your income, depending on the carrier and whether you choose short-term or long-term coverage.

3. What’s the difference between short-term and long-term disability insurance?

• Short-term disability (STD): Covers disabilities lasting a few weeks to six months.

• Long-term disability (LTD): Covers disabilities that last years — sometimes all the way to retirement age.

4. How does “own occupation” coverage work?

“Own occupation” means you’re considered disabled if you cannot perform your specific job, even if you can work in another field. This is the strongest definition of disability and often recommended for professionals.

5. Do I need disability insurance if I’m young and healthy?

Yes. Most disabilities are caused by illness, not accidents, and they can happen at any age. Securing coverage when you’re young and healthy gives you the lowest possible rates and protects your income early.

6. Does disability insurance cover pregnancy?

Short-term disability often covers maternity leave and complications from pregnancy. Long-term disability may cover complications that prevent you from returning to work beyond the typical recovery period.

7. Can I get disability insurance if I’m self-employed?

Absolutely. Policies can be tailored to replace your business income or provide overhead expense coverage to keep your business running while you recover.

8. What happens if I return to work part-time after a disability?

Many policies offer partial or residual benefits, which continue paying a portion of your benefit if you can return only part-time or at reduced income.

9. Will my premiums increase over time?

It depends on the policy. Non-cancellable and guaranteed renewable policies lock in your pricing and guarantee your benefits as long as you pay premiums.

10. How long does it take to start receiving benefits?

This depends on your elimination period — the waiting period before benefits begin. Typical options range from 30 to 180 days.

Life Insurance FAQs

General

1. What is life insurance?
   Life insurance provides a payout (called a death benefit) to your chosen beneficiaries if you pass away. It helps protect loved ones financially by covering expenses such as income replacement, debts, funeral costs, or future goals like education.

2. Why is life insurance included in the benefits marketplace?
   Life insurance gives employees affordable access to protection that helps safeguard their families. Offering it as part of a workplace marketplace often means lower costs and simplified enrollment.

3. Who needs life insurance?
   Anyone who has family members or dependents who rely on their income (such as a spouse, partner, or children) should consider life insurance. It’s also valuable for covering final expenses or leaving a legacy.

Coverage

1. What types of life insurance are available?
   The marketplace may include:

• Term Life Insurance: Coverage for a set period (e.g., 10, 20, or 30 years), usually the most affordable.

• Permanent Life Insurance (Whole or Universal): Coverage that lasts for life and may include a cash value component.

1. How much coverage should I choose?
   It depends on your needs—common guidelines suggest 5–10 times your annual income. Advisors or online tools can help you calculate a more precise amount.

2. Can I keep coverage if I leave my job?
   Yes, many policies are portable, meaning you can keep the coverage even if you change jobs.

3. What if I already have life insurance?
   You can still compare marketplace options. Many employees use supplemental policies to add more coverage beyond what they already have.

Costs & Enrollment

1. How much does life insurance cost?
   It depends on age, health, coverage amount, and policy type. Group and marketplace rates are often lower than buying individually.

2. Can I pay through payroll deductions?
   Yes, most policies allow premiums to be deducted directly from your paycheck for convenience.

3. Is a medical exam required?
   Some policies require a basic health screening, while others (especially group term coverage) may not require medical underwriting.

Claims & Benefits

1. How do beneficiaries receive the life insurance benefit?
   In the event of a claim, the insurance company pays your chosen beneficiaries directly, usually as a lump sum.

2. How do I update my beneficiaries?
   You can update your beneficiaries anytime by logging into the portal or contacting the insurance provider.

3. Is the death benefit taxable?
   In most cases, life insurance death benefits are paid to beneficiaries tax-free.