Archive for July 12, 2007
In yesterday’s post I discussed the need for long-term disability policies. Life insurance policies are relatively easy to comprehend. My husband and I purchased term insurance for 20 years, believing that our homes will be paid off by that time. Most people don’t need extra riders on a life insurance policy, the payout is simple, you die and your beneficiary gets paid. But disability insurance policies can be quite confusing. After all, unlike death, disability isn’t so cut and dry. Some policies will pay you if you cannot work at your current profession, others will only pay you if you cannot work in any profession.
I spent a long time reviewing various policies and riders and documented those details in this post back in May of 2006.
M’s comment about failing health on yesterday’s post has left me thinking more and more about unexpected illnesses and how best to prepare for them. When you are young you never think about becoming ill or being injured, at least I know I never did, but having lived through a medical crisis I now know there is a lot you can do to prepare.
Fortunately, I had unknowingly made a number of extremely important decisions long before I became ill. First, although a number of people, told me to save money by signing up with an HMO, I ultimately chose a PPO. At the time of open enrollment I had no signs of illness, but even then I knew that I wanted access to the best medical care my dollar could buy.
When you are sick your only desire is to be well. In your absolute worst state of mind, when fear has taken hold of you, you will find yourself being ignored by receptionists, not receiving call backs by technicians, and fighting with insurance companies to find the proper diagnosis code required for urgent tests. The last thing you want to contend with is the need for a primary doctor’s referral. In order to receive the referral you have to schedule an appointment with your primary doctor, wait to be seen, and then take the little piece of paper to the specialist who won’t be able to see you for at least a few weeks.
The PPO enabled me to schedule visits with specialists without a referral. My medical condition was rare, and throughout my medical ordeal I visited many incompetent doctors. I saw specialists, recommended by primary doctors, who didn’t look at my x-rays and test results and couldn’t understand my diagnosis. If I left a doctor’s office unsatisfied by the information I was given, I immediately visited another specialist for a second opinion. When it was finally determined that I would require an unusual surgery, I went straight to the top, and was operated on by the chief surgeon of a renowned hospital.
Your health is your number one asset. If you are not healthy you may not be able to work. Believe me, even if you are not sick, spend the extra money and get the best medical insurance your dollar can buy.
The second most important lesson. If your employer does not offer a long-term disability policy go out and buy one immediately. According to the Health Insurance Association of America, Approximately 30% of all people 35 to 65 will suffer a disability for at least 90 days, and about one in seven can expect to become disabled for five years or more. It is much more probable for individuals under age 55 to become disabled than die. You will hear a lot of new parents talk about purchasing life insurance policies but you rarely hear of individuals purchasing disability insurance. Although, I never required a long-term disability policy, I was back at work after a few months, I would never go without one today.
Also realize that you cannot turn back the hands of time. Once a major health issue occurs you will either be denied by insurance providers or pay quite a lot more than those who are healthy. If you are planning on having children, even if you do not have any now, you may want to think about taking out a life insurance policy. You can always cancel it a few years later if you decide it’s not necessary.
Lastly, definitely consider employee benefits when choosing your employer. My employer saved the day with a short-term disability policy that paid for my recovery after surgery. Thanks to this benefit my husband and I never had to tap our bank accounts to pay for medical bills and associated expenses. If you don’t have a short-term disability policy with your employer definitely build an emergency fund.