If you suddenly became too sick or injured to work, how long could you manage without your income? Not all employers offer long-term disability (LTD) insurance coverage. Being self-employed means you don’t have access to any type of group benefits policy. If you want disability coverage but do not have it through a group benefits policy through your job, consider purchasing a private long-term disability insurance policy. A private disability policy can protect your income, your lifestyle, and your ability to recover without financial stress.
What is Disability Insurance?
Disability insurance is an income replacement benefit. It replaces a portion of your income if illness or injury prevents you from working. It’s designed to supplement your income to provide financial stability during periods when you are unable to work. Think of it as a “peace of mind” policy, that ensures an income if an unforeseen medical condition affects your ability to do your job.
What is a Private Disability Policy?
A private disability insurance policy is a policy of insurance that is purchased independently through an insurance broker or provider and not through your employer’s group benefit plan. People who don’t have long term disability coverage through a group benefits policy will often purchase a private disability policy.
Private LTD policies are ideal for self-employed individuals, freelancers, contractors or employees whose employers do not offer disability coverage.
The advantage to private policies is the flexibility and control they offer:
- You can control the premium you will be paying depending on the coverage you select.
- You can decide how long benefits are payable. For instance, certain policies may cover you for a finite amount of time (i.e. 5 years) or you can select coverage until you turn 65.
- You can set your benefit amount.
What is An Own Occupation Rider?
An Own Occupation Rider (“Own-Occ Rider”) is a feature you can include in your disability insurance policy.
Most disability policies contain a Change of Definition after the 2-year mark, meaning that after two years the policy definition for total disability changes. The insurance company assesses you on whether you can work in any occupation versus your own occupation.
The Own-Occ Rider limits the definition in the policy by tying it to your specific profession.
Why is the Own-Occ Rider important? The Own-Occ Rider is important because it protects professional designations, ensuring that your disability claim is assessed based on your own occupation, and not another type of work.
Example:
If you’re an ultrasound technician who has suffered a rotator cuff injury that stops you from completing scans, the insurance company will evaluate your medical restrictions on whether you can perform the duties of your occupation as an ultrasound technician, not whether you can work as a different type of technician.
When to Buy Private Long Term Disability Insurance?
You should consider a private long-term disability policy if:
- You’re self-employed or a freelancer with no group benefits.
- Your employer’s plan doesn’t include long-term disability coverage.
- You want customized protection, for example, coverage until age 65 or with an Own-Occupation definition.
- You have specialized training or a professional designation you want protected.
In short, it’s worthwhile to take out a private policy for long term disability whenever losing your income would put your financial security at risk.
Key Takeaways: When It’s Worthwhile to Buy Private Long-Term Disability Insurance
- Get a private policy if you don’t have group coverage.
Self-employed professionals, freelancers, and contract workers often have no access to employer disability plans. A private policy fills that gap. - It protects your income if illness or injury keeps you from working.
Disability insurance provides essential financial stability when you can’t earn an income due to medical reasons. - You control the coverage and cost.
Choose your benefit amount, premium, and how long benefits last – from a few years to age 65. - Add an Own Occupation Rider for stronger protection.
This rider ensures your benefits are based on your ability to perform your specific job, not any job. - It’s worthwhile whenever losing your income would cause financial stress.
A private disability policy ensures you can focus on recovery, not financial survival.
Denied a disability claim? We can help.
If you’ve made a disability claim on your private policy and have been denied, contact Whitten & Lublin. We offer free consultations for short- and long-term disability claims. Contact us online or call 416 640 2667.
Author – Aman Chaggar
What is long-term disability (LTD) insurance?
Long-term disability insurance is an income replacement benefit that provides financial stability if illness or injury prevents you from working. It typically replaces a portion of your income, helping you maintain your lifestyle while you recover.
What is a private long-term disability policy?
A private LTD policy is purchased independently, not through an employer’s group benefits plan. It is ideal for self-employed individuals, freelancers, contractors, or employees without employer disability coverage. Private policies allow you to customize your coverage, premium, and benefit duration.
What is an Own-Occupation Rider in LTD insurance?
An Own-Occupation Rider ensures that your disability claim is assessed based on your specific profession, not any job. This protects specialized training or professional designations. For example, an ultrasound technician with an injury would be evaluated on their ability to perform ultrasound scans, not other types of work.
When is it worth buying private long-term disability insurance?
A private policy is worthwhile whenever losing your income would threaten your financial security. It provides:
- Income protection if illness or injury prevents you from working
- Flexible coverage and premiums
- Enhanced protection with an Own-Occupation Rider
Can a private LTD policy be denied?
Yes, claims can be denied. If your private LTD claim is denied, it’s important to seek professional help. Whitten & Lublin offer free consultations to assist with short- and long-term disability claims.
