The end is near.
We have been producing a series of posts to help you understand the jargon that is used in the insurance industry to describe various provisions, rules and details of disability insurance policies. Knowing these terms will help you make an informed choice when you are shopping for the best policy for you and your family.
We’ve been moving in alphabetical order, and this is the sixth of seven installments of the key terms to know. This installment starts with the letter Q.
Qualification Period
The period of time (in addition to the elimination period) in which you (the insured) must be totally disabled before receiving residual benefits.
Recurrent Disability: If a disability recurs within six months of you returning to work from the original disability, the insurance company will consider the recurrence a continuation of the original disability – this means you would get benefits immediately rather than waiting through an elimination period a second time.
Reinstatement: If a policy is canceled due to non-payment of premium, this provision states the terms of the insured applying for reinstatement of the policy. This usually requires a signed application, statement of continuing good health and payment of all outstanding premiums plus interest.
Relation of Earning to Insurance: If you have too much insurance, the company can reduce your benefit based on your average monthly income determined over one or two years prior to the onset of your disability.
Renewability Provisions: Most insurance is based on a one-year term. Some policies are guaranteed renewable after each year, while others are renewed on condition of payment of a new premium. Some policies are cancelable or may have their premiums increase each year, while a non-cancelable contract – usually reserved for dentists, doctors and lawyers – guarantees not only renewability but no increase in premium and no cancellation.
Sickness: A disease or illness that presents symptoms while the policy is in force. A pre-existing illness (prior to the policy being in force) can be covered provided it is stated on the insurance application and is not manifested prior to the policy being in force.