Supplemental long-term disability insurance is the policy you buy to top up existing insurance. For example, perhaps you have employer-sponsored coverage, but it is far below your allowable maximum. You buy an individual insurance policy to make up the difference. The individual policy becomes your supplemental policy. Let’s look at more scenarios where a supplemental policy makes sense.
- Your group coverage ends after two years and has a classification of any option. You purchase supplemental long-term disability benefits to increase the coverage period so you are not forced to take “any” job after just two years if you are still disabled.
- Your existing coverage has a very long elimination period and you cannot self-insure for that length of time. You purchase supplemental long-term disability insurance with a shorter elimination period so you can access benefits faster.
Remember, however, that disability insurance is not stackable and that you can only collect your maximum allowance from all sources. Be careful not to over-insure yourself and wind up paying for coverage you cannot use. Consult with a life insurance broker to discover your best long-term disability insurance plan.
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