Canada Life Insurance Quote: Compare Before You Purchase Disability Insurance
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Once you have decided to purchase mortgage disability insurance, it is important to know what you are being offered. So as to compare the various policies that will be offered to you, you have to be aware of and understand each aspect and its impact on the policy premium.
One of the first and most important features that the insurance will cover is the definition of the disability. This is a critical component, especially when you have a highly specialized job. The two general ways to define disability are "Own Occupation" and "Any Occupation". Own occupation means it is what you are qualified to do, and if you can no longer , your income will be severely cut back. An any occupation limitation says that you are unable to work in any job. If you were an airline pilot, you could be offered another lower level job with the airline, for instance.
This is a real possibility if you pick the Any occupation option. Make sure you are covered for being unable to perform your current occupation.
Now check the benefit period of the insurance. Usually people choose a benefit period of 65, since it is the traditional end of working life, but if you have funds put away that would have allowed you to retire early, you may not have to take the full period. This may include a spouse's eligibility for social security benefits, qualification for early retirement package from your employer, or the ability to tap a qualified retirement fund early, at 59 for no penalty withdrawals, for example.
The amount of the benefit is a significant feature of the insurance. Normally, one would expect to cover the amount of the monthly mortgage bill. But in addition, perhaps you should cover other home related expenses to make sure you can retain the home, such as the property taxes, insurance and maintenance costs. Adding a cushion for these items will increase the premium, but can be worth it over the long run.
Be sure you understand and are clear on these basic components of any policy you are considering. There are many other features, most of which are optional additions to your policy, otherwise known as riders.
The inflation protection rider is a useful rider. Your monthly benefit will increase as the cost of living goes up. Since prices are always going up, this is a concept that should be considered. You may opt for simple or compound inflation rider; the compound adds new increases to existing ones.
Some other riders that might be offered to you are non cancelable policy, guaranteed renewable policy, guaranteed future insurability and waiver of premium.
Article Source: Articlelogy.com
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