Sometimes when shopping for disability insurance, you may be unsure of what you are looking for. That is when it is important to request revised disability insurance. Or, perhaps the initial disability insurance quote comparison is more expensive than you expected.
Here are the ways you can revise your disability insurance quotes to make necessary changes:
1) Change the monthly indemnity (monthly benefit amount). The rates are linear. As such, if you wanted 75% of the quoted amount, reduce the premiums by that amount. Sometimes quotes are shown for $1000/month benefit. For instance, medical residents may purchase between $1000/month and $5000/month. Showing $1000/month will show the cost per thousand. Some medical residents who still have several years in training choose $1000/month benefit to keep costs lower and to still be able to increase benefits in the future.
2) Change the benefit period. Benefit period (the length of time a policy claim is paid) ranges from 2 years to lifetime with 5 year, 10 year, age 65 and age 67 options available. The longer the benefit period, the larger the premium. If you start with a longer benefit period, you can reduce it in the future without any medical underwriting. The opposite is not true. If you want to lengthen the benefit period in the future, this would require medical questions.
3) Removing or adding riders. The most expensive rider tends to be the cost of living rider which is an inflation rider. This is an important rider for longer benefit periods and for younger people who have a longer potential claim. The residual rider and increase option riders are valuable. Some increase riders such as the benefit purchase rider from Guardian or the benefit update rider from Principal Financial Group do not cost extra. You may remove riders at any time in the future without any medical underwriting. Adding riders require medical questions.
4) Changing the elimination/waiting period. The longer the wait, the lower the premium. Most individual disability insurance policies have a 90 day elimination period as this tends to be the most cost effective. A 60 day waiting period may double the cost of a 90 day waiting period. A 180 day waiting period typically does not reduce the cost dramatically.
5) Compare quotes. It is important that you look at multiple quotes from various companies as the rates can vary greatly. This is due to how each company prices their policies and how they classify your occupational class. For example, some companies classify pediatricians and gastroenterologists higher than other non surgical specialties.
The most important part of shopping for a disability insurance policy is determining your priorities and what you need. Calculate what you would need to pay your fixed monthly expenses if you could no longer work. Prioritize how long you would need to have the coverage and if the extra riders are important or necessary.
For more information about individual disability insurance, to request a quote comparison or to revise an existing comparison, please contact Set for Life Insurance today!