Disability Insurance Center
Cancelling Disability Insurance
Article 6 of 8 in What to Know About Disability Insurance
As your lifestyle and needs change, your disability insurance policy needs to be able to change as well. A personal disability insurance policy can be extremely flexible by allowing you to make adjustments that will change the coverage of the policy to better suit your needs. In order to get the most out of your personal disability insurance policy, consider any life changes that my require an increase to your benefit amount, your length of benefit payments, and any riders you may need to delete or add to give you extra coverage.
TIP: Make sure your personal disability insurance policy keeps up with your ever changing life by doing annual reviews of your policyÃ¢â¬â¢s coverage and making the adjustments when necessary.
Suggested Changes for your Personal Disability Insurance
Below are some changes to consider making to your personal disability insurance policy. Some of these changes may require underwriting approval, proof of insurability, or may cause an increase in the cost of your disability insurance. Weigh the cost of the change with the added coverage benefit before you make any decision!
- Increase or decrease the maximum monthly benefit payment for the Disability Benefit or Social Security Substitute Benefit sections;
- Lengthen or shorten the Elimination Period on either section;
- Lengthen or shorten the Maximum Benefit Period;
- Add or delete a benefit rider like the Cost of living Rider, Waiver or Premium Rider, or Partial disability rider (if not automatically included)
TIP: Changes that increase your benefits can dramatically increase the cost of disability insurance depending on your health. Choosing the appropriate benefit amount, or adding a rider that will automatically increase your benefit levels when you first take out your policy can help you to avoid having to prove insurability in later years when your health could change.
How to Change Your Disability Insurance Plan
Making changes to your disability insurance contract can be as simple as calling your agent or insurance company representative. If the change requires underwriting review (i.e., increasing your benefits, shortening your elimination period), you may be asked to submit a short signed application or form allowing the insurance company to go through their formal underwriting process. Check with your agent or company representative on the process of making any changes to your disability insurance plan.
Personal Disability Insurance Conditions
There are conditions that occasionally must be met in order to make changes to your personal disability insurance policy.
- First, your personal disability insurance policy must be in force.
- Second, you cannot be disabled or eligible for disability benefits even if you are not receiving benefits.
- Third, your premiums cannot be in default. The premium is not considered to be in default within the 31-day grace period following the premium due date. But it is in default after the grace period expires.
Keep in mind, the insurance company retains the right to deny any requested adjustment or change, even one that does not require evidence of insurability.
Replacing Your Personal Disability Insurance Policy
If you feel that you have found a better disability insurance plan, make sure your new policy does not short change you in coverage. It is important that you do not excessively cut coverage for the sake of saving on the cost of disability insurance. While saving money is important, a policy that will not provide you with sufficient coverage can hurt you should you get injured and need the insurance proceeds. When changing your policy, take the same due diligence to find the right disability plan that you would when you shop for a new policy.
TIPS: Be sure that you are approved for the new policy before canceling the existing policy. Just receiving a quote does not mean that you will be approved for the disability insurance plan.
Replacing a disability policy can be tricky. Keep in mind the following before you decide to get a new disability insurance plan:
- Make sure that you are not being pushed towards the change by an agent. An agent earns commission on every disability insurance plan, and may be motivated by personal gains to encourage you to buy a new plan.
- Keep in mind that if the incontestability period on the old policy has lapsed, the likelihood that it will be cancelled is slim to none. Your new policy will start a new two year incontestable period during which your policy can be canceled.
- Make sure your new policy is with a financially sound disability insurance company. You should check out the insurance companyÃ¢â¬â¢s financial ratings before purchasing any new policy.
If you are looking to change your existing disability insurance plan, or find a personal disability insurance policy to fit your needs, click here to visit the Free Advice Quote Center today