Is Your Disability Insurance Policy Adequate? What to Look for Before You Need It

Disability insurance is designed to offer financial security when illness or injury prevents you from working. But too often, policyholders don’t fully understand what their disability coverage actually includes until it’s too late. 

If you’re relying on a disability insurance policy to protect your income, it’s essential to evaluate whether your coverage is truly adequate before you need to file a claim.

Understanding Your Policy: Group vs. Individual Plans

The first step in evaluating your coverage is identifying what type of policy you have. Most people are covered under employer-sponsored group disability insurance, which often has limited benefits and stricter definitions of disability. In contrast, individual disability insurance policies offer more robust protection but come at a higher cost.

Group plans often have:

• Limited benefit periods (typically 2-5 years)
• A definition of disability that may require you to be unable to work in any occupation, not just your current one
  

An individual policy may offer:

• Coverage until retirement age
• “Own occupation” protection, allowing you to receive benefits if you can’t perform the duties of your specific job

Key Features to Examine

Even a comprehensive-sounding policy can fall short when it comes time to file a claim. Look closely at these policy elements to determine whether your disability insurance is truly adequate:

• Definition of Disability: Does your plan define disability as being unable to perform your job or any job? “Own occupation” policies are generally more favorable to the insured.
• Benefit Amount: Will your policy replace 60-70% of your income, or is the cap too low for your needs?
• Waiting Period (Elimination Period): How long must you wait after becoming disabled before benefits begin? Common periods range from 30 to 180 days.
• Benefit Duration: Will benefits last only a few years or continue until age 65 or longer?

Common Gaps in Disability Coverage

Many people are surprised to learn that their existing coverage may have serious limitations. Common weaknesses include:

• Mental health exclusions or limitations (e.g., a 24-month cap on benefits for depression or anxiety)
• Partial disability limitations, where you might still be working but unable to earn your full income
• Inadequate inflation protection, causing long-term benefits to lose value over time

What You Can Do to Strengthen Your Protection

Taking a proactive approach now can make a huge difference in the future. Consider:

• Supplementing your group policy with an individual plan for better income replacement and longer benefit periods
• Reviewing your policy annually, especially after major life changes such as marriage, starting a family, or a significant income increase
• Consulting a disability insurance lawyer to clarify ambiguous language or contest unreasonable limitations in your policy

Talk to a Philly Disability Insurance Lawyer at Edelstein Martin & Nelson

At Edelstein Martin & Nelson, we’ve helped countless Philadelphia workers navigate the complex world of disability insurance. Whether you’re reviewing a policy, preparing to file a claim, or facing a wrongful denial, we can help ensure your rights are protected. Don’t wait until you’re unable to work. Reach out to our experienced Philadelphia disability insurance lawyers today at (215) 731-9900 to schedule a free consultation.