Long term disability insurance provides coverage for individuals who are unable to work due to a long-term illness or injury. It typically replaces a portion of the individual's income while they are unable to work. The specific coverage provided by long term disability insurance can vary depending on the policy, but it generally includes the following:
1. Income Replacement: Long term disability insurance typically provides a percentage of the individual's pre-disability income as a benefit. This can range from 50% to 80% of their income.
2. Duration of Coverage: Long term disability insurance can provide coverage for a specified period of time, such as two years, five years, or until the individual reaches retirement age.
3. Definition of Disability: The policy will define what qualifies as a disability and the criteria that must be met in order to receive benefits. This can vary between policies, but generally includes being unable to perform the duties of your own occupation or any occupation.
4. Waiting Period: There is typically a waiting period before benefits begin, which can range from 30 days to 180 days.
5. Exclusions: Long term disability insurance may have certain exclusions, such as pre-existing conditions or disabilities resulting from self-inflicted injuries or illegal activities.
It's important to review the specific terms and conditions of a long term disability insurance policy to understand the coverage provided. Each policy may have different limits, exclusions, and definitions of disability. It's also important to note that long term disability insurance does not cover every type of illness or injury, so it's important to understand the specific coverage provided by your policy.