The prospect of long-term disability (LTD) is so frightening that some people choose to ignore it. While we all hope that "nothing will happen to me," relying on hope to protect your future earning power is not a good idea. Instead, choose a disability policy that provides enough coverage to enable you to enjoy your current lifestyle even if you can no longer continue working.
Long-term disability provides a monetary benefit equal to a portion (e.g., 50% or 60%) of the insured's salary for covered disabilities. Long-term disability typically begins when short-term disability ends. To receive benefits, the disability must have occurred after the policy's issuance and then, typically after a waiting period. Medical information, often confirmed by a physician, must be provided to the insurer for consideration.
Most long-term disability insurance policies categorize disabilities as own occupation or any occupation.1 Own occupation means the insured, due to disability, is unable to perform their regular job or a similar job. Any occupation means the insured, due to disability, is unable to perform any job for which they are qualified.
Similar to short and long-term disability insurance, workers' compensation, or workers' comp, it pays a monetary benefit to workers who become injured or disabled at work or while performing their jobs. Most states require employers to carry workers' compensation insurance for their employees. In exchange, employees may not sue their employer for negligence.
Health insurance is an agreement wherein an insurance company agrees to compensate the insured for the medical and surgical expenses incurred during the policy tenure. The medical expenses may incur if the insured falls ill, or meets an accident that leads to hospitalisation of the insured. To be eligible to avail coverage benefits under the policy, the policyholder is required to pay a specific amount periodically, known as premium. Health insurance premium is decided by an insurance company and policyholders are required to pay the same on a monthly, quarterly, half-yearly, or yearly basis, without any lapse, to avoid losing the renewal benefits.
Why is Health Insurance Important?
With rising healthcare expenses, access to the required and quality medical treatment can be financially draining. So, to protect yourself and your family against these expenses, you must get everyone insured under a reliable health insurance plan in time. Here are top reasons why you should consider buying health insurance today:
Comprehensive CoverageA health insurance policy keeps you covered for major healthcare expenses incurred in case of medical emergency. Usually, health insurance plans keep you protected for in-patient hospitalisation expenses pre-hospitalisation and post-hospitalisation expenses, ambulance expenses, domiciliary hospitalisation expenses, daycare procedures, organ donor expenses, treatments taken under AYUSH systems of medicines, etc.
Lifetime RenewabilityAs per the guidelines issued by Insurance Regulatory and Development Authority of India (IRDA), the insurance companies offering health insurance plans are supposed to offer lifetime renewability benefits to the policyholders. It allows you to renew your health insurance policy without any upper restriction on the maximum age limit. The feature is most beneficial for parents and senior citizens as they can renew their insurance plans without any pressure of looking for new health insurance plans in old age.
Cashless TreatmentInsurance companies have tie-ups with certain hospitals, known as network hospitals, where the insured can avail cashless treatment. If you avail treatment at these hospitals, the insurance company will directly settle the bills at the hospital, and you will not be required to pay anything for the treatment availed, except for non-medical expenses incurred.
PortabilityHealth insurance portability allows the policyholders to switch from their existing health insurance company to another, in case they are not satisfied with their existing health insurance plan, or find a more suitable plan. Portability feature saves the policyholders from being taken for granted and offers them flexibility to switch in case of dissatisfaction.
Tax Benefits Under Section 80D of the Income Tax Act, 1961The government of India promotes health insurance by offering tax exemptions of up to Rs. 1.5 Lakh on the premium paid for health insurance plans, under Section 80D of the Income Tax Act, 1961. An individual can also claim a deduction of up to Rs. 25,000 for insurance cover for self, spouse, and dependent children. You can also avail a tax deduction of up to Rs. 25,000/Rs. 50,000 for health insurance plans purchased for parents aged 60 years/ more than 60 years.
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