Disability insurance is one form of insurance policy that nearly everyone should have. It’s fairly affordable, protects your income when you’re suddenly unable to work due to injury, sickness, or similar disabilities, and depending on the type of policy you get, it might support you for a six-month spat, or it might cover you all the way to retirement.
However, like most things comprised of red tape and bureaucracy, it’s not something that just instantly takes effect, and you should expect a little resistance, or at least an attempt at resistance, from the insurance company.
Most of the time, if you’re making a valid claim and didn’t go against your policy in any way, this takes the form of a stressful waiting period.
This guide is going to cover what the waiting period is for, how long the waiting policy for a disability insurance policy is, and ways you can make the period a bit easier to deal with.
What is the Waiting Period for a Disability Insurance Policy in the Grand Scheme of Things?
When you purchase a disability insurance policy, whether it is short-term or long-term, you hopefully aren’t in immediate need of it. So, you purchase the policy, pay your annual premiums, and continue your life as usual. Until something happens that disables you, the policy is more or less useless.
However, whenever you suffer one of the many disabilities covered by private disability insurance policies, you get to see just how useful your policy really is; there’s a process to it, though.
Once you get into a car wreck, suffer a heart attack, develop debilitating chronic pain, or otherwise get put out of work due to a disability, you have to contact your insurance agency and make a claim.
Making a claim is usually a fairly extensive process. You need to have an exact record of what happened, how it has prevented you from working, and proof that what you’re claiming is true. Usually, this requires you to at least get an in-depth assessment and diagnosis from a physician. This is the primary requirement for you to get a passable claim, but it may not be all you need to do. In some instances, you may even need records and statements provided by your employer showing what type of work you do and how the physician’s diagnosis prevents you from tackling such tasks. Sometimes, you may even need to visit a physician approved by the insurance agency, but this is less of a problem, nowadays ((1)).
Once you’ve gathered the required proof, it’s time to complete the paperwork for your insurance agency. This is typically run-of-the-mill red tape where you read the document, fill in a few personal information fields, and sign on the dotted line. It can be stressful, but you’ve most likely completed more complicated paperwork in the past.
Finally, you’re ready to start getting your disability benefits, right? No. This is when the waiting period starts, and it’s the most stressful part of the claim process.
What is the Waiting Period for?
The waiting period is the most stressful part of the disability insurance claim process because it’s essentially the period when the insurance agency goes over every tiny detail of your claim, your policy, and the information you provided when purchasing the policy to determine whether or not you’re eligible.
Keep in mind that your insurance company may be liable for covering your income for anywhere from a couple of months to decades depending on the type of policy you purchased and made a claim on. While you must pay your premiums on time every year, whether you use your benefits or not, your insurance company has the opportunity to deny your claim and keep their money if they can find a reason to, and you can believe that they do their due diligence to save money and keep your premiums. This is what they do throughout the waiting period. If you want all the benefits of insurance you must wait.
If that doesn’t sound ethical or fair, you probably shouldn’t think about how the claim administrators in charge of reviewing your claim typically have a conflict of interest due to working for the insurance company ((2)).
To make the waiting period less stressful and prevent the agency from denying you benefits you’ve paid very well for, keep the following things in mind.
Claim administrators are thorough, and they’re going to want to go through all of your medical records to see if you omitted information, did something that may have created your disability, or if something you said on your claim doesn’t line up with the recorded facts.
To do this, they will request medical records from your physician. If any of the required records aren’t available, received in time, or yes, even if the administrator doesn’t ask for them, your claim can be denied.
To avoid this, you need to be on your toes and push the insurance company to do its job. Contact the insurance company to see what records they need, contact any relevant medical professionals you need and have the records sent over.
Get Regular Medical Treatment:
Insurers like taking your money when there’s minimal risk involved on their part. A policy they never have to payout is essentially free 100% profit. So, they expect you to get regular medical treatment. If you learned 4 years ago that you have a degenerative muscle disorder, and you didn’t go to the doctor regularly to get treatment, they can deny your claim.
If you were diagnosed with a mental disorder such as bipolar disorder and didn’t see your psychiatrist every month, they can deny your claim.
Get regular medical treatment, and make sure you take your appointments seriously to ensure you can show your insurer that you did everything you were supposed to do.
Get a Written Statement from Your Doctor:
Taking your insurance company’s forms to your doctor and having him fill them out is a good way to get a denial during your waiting period. After all, the company fighting to withhold your benefits is the company that created the questionnaire.
Beyond having your doctor fill out the forms, have them write a letter that highlights every detail of your disability and how it prevents you from working. This keeps the insurer from using clever wording to deny your claim.
Less Obvious Concerns:
Insurance companies will use what they can to deny a claim. This includes having a private investigator record you while you’re out and about. If you claim you can’t walk throughout your shift and need your benefits, but the PI catches you running a 5K on the weekend, it’s not good for your claim.
They’ll also try to use deadlines and technical loopholes to deny your claim. So, make sure when applying for disability insurance you’re on top of every deadline you have for turning in records and paperwork.
All of these behaviors are well documented, and you can find them in the second link of the “Sources” section.
How Long is the Waiting Period?
Now that you know what the waiting period is and how the insurance company uses it against you, along with a few tips to counter their tactics for denial, you’re probably wondering how long you have to put up with it?
Well, that’s a complex answer that depends on a couple of factors:
- Whether you’re filing a short-term or long-term policy claim.
- The extent of your disability and how well you prepared.
The Length of a Short-Term Disability Claim Waiting Period:
Short-term disability claims tend to be much quicker to pass than long-term claims.
In general, you can expect to wait 30 to 60 days for your claim to be approved, and many short-term disability claims are approved within just two weeks. It’s good to know the difference between short vs long term disability insurance.
The more you prepare for your claim, and the more proof you have, the faster your claim is going to be approved. The goal is to quickly rule out any of the things your claim administrator will try to use for a denial.
Keep in mind that the shortest waiting periods also tend to come at an increased price. Your premiums will be higher, but you won’t have to sit around stressing out for a month straight when you’re already dealing with a disability and a lack of income. So, it’s typically worth the higher premium just for the peace of mind it provides.
Luckily, you’re not just sitting around losing income from the second you lose your job until the moment your benefits are approved. It will feel that way in the short term, but disability insurance companies are required to pay “back pay” payments. Once you make a claim, which should be as soon as possible once you’re labeled as disabled, the benefits you should be paid pending approval are added up. If your claim is approved, you’re paid every payment you missed sitting around waiting for approval.
With short-term claims, this isn’t as substantial or nearly as key as it is with long-term claims, but it is important to consider ((3)).
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How Long is the Long-Term Disability Insurance Claim Waiting Period?
Long-term disability insurance is a bit more complicated, still it’s good to think about long term care planning. While you can miss a paycheck or two waiting for a short-term claim, you can experience financial ruin waiting for a long-term claim; at least, life may get very difficult for a while. The back-pay feature of short-term claims is relevant to long-term claims, too.
Since long-term disability insurance is likely to pay you for years or even decades until you retire, the insurance company is going to want to fight it much harder than a short-term claim that amounts to just a few months of payments.
When you make a long-term disability insurance claim, expect to wait anywhere from 90 days to a full year before you get an approval notice and start receiving benefits. This can be ruinous in the short-term since your disability is clearly preventing you from earning income, and you can’t even push yourself through the pain and work for a few months without worrying about your insurer using that to deny your claim –see source 2 for further information- ((4))
However, there is a way to protect yourself financially during this long waiting period, but it requires you to have a short-term disability policy as well.
If you remember from the previous section, short-term disability claims can take as little as two weeks to be approved. They also provide coverage for up to six months, but in the event, you’re waiting for a long-term disability insurance claim to be approved, you can get that extended to one year. This is enough to provide you with partial income protection while you wait on the long-term claim to be approved ((5)).
Keep in mind that, similarly to a short-term policy, you can expect a quicker approval if you dot your I’s and cross your T’s before and during the claim filing process. Your decisions prior to making the claim will be the main factor in whether or not you’re approved quickly or stuck waiting a year just to get a denial letter.
Choosing the Right Insurer and Disability Insurance Policy
As you can see, the nature of the claim administrators and insurance agents in charge of your policy and claim is a key factor in whether you’re approved or denied and how quickly that happens. Obviously, it’s to your benefit to work with an insurance agency that genuinely cares about its policyholders, and you definitely want a policy that helps prevent many of the issues that prolong waiting periods or cause denials.
Finding the perfect policy for you can be difficult, though. That’s what Policy Solver is for. Rather than shopping for disability insurance on your own, you can use Policy Solver to get hands-on guidance throughout the shopping process, and the Policy Solver team will actively work with its own network of insurers to find a straightforward, affordable, and reliable coverage plan for you.
1: Taken from Policy Genius, 03/04/2022, https://www.policygenius.com/disability-insurance/how-to-file-a-disability-insurance-claim/
2: Taken from Nolo, 03/04/2022, https://www.nolo.com/legal-encyclopedia/why-long-term-disability-ltd-applications-get-denied.html
3: Taken from Nolo, 03/04/2022, https://www.nolo.com/legal-encyclopedia/how-are-social-security-disability-ssi-backpayments-calculated.html
4: Taken from Finder, 03/04/2022, https://www.finder.com/how-long-to-get-disability-insurance
5: Taken from Zenefits, 03/04/2022, https://www.zenefits.com/workest/how-long-is-short-term-disability/