As a foreign national, your ability to earn an income is one of your greatest financial assets. Unfortunately, being involved in an accident or diagnosed with a disabling illness will not only have devastating effects on your plans in the country, but it will also affect the wellbeing of your loved ones. Disability insurance coverage will help guard against this.
Disability Insurance for Foreign Nationals
Why Do Foreign Nationals Need Disability Insurance
Income Replacement Plan
If you are unable to work and lose your job due to a disability, your disability insurance policy will provide you with a regular source of income to meet your household needs.
Protection Against Poverty
Disability conditions often force people into poverty and make them and their dependents live below the standard of living after losing their source of income. As reported by the University of California, the difference in poverty rates between those living with and without a disability is between 12% to 29%. The proceeds from your policy will help you maintain a quality standard of living.
Also, many disability insurance products offer a Cost of Living Adjustment Rider (COLA), a feature that ensures your disability benefit payment increases whenever there’s inflation.
Tax-Free Benefit Payment
Every penny you get from your disability benefit will be entirely yours, as you won’t need to pay tax on it. This will help you to have enough money to cater for yourself and your family.
Protection Against Loss of Properties
Disability doesn’t only force people into poverty, it makes them lose their hard-earned assets, especially when the income to maintain a lifestyle and pay bills is gone. Mortgage foreclosures are some of the most common aftermath effects of disability, and they occur sixteen times as often as they do for death. The disability insurance regular benefit payments can save you from losing properties in the U.S. acquiring and keep you and your family from becoming homeless.
What Kinds of Disability Insurance Policies Are Available to Foreign Nationals
How Group Disability Insurance Works for Foreign Nationals
This is employer-provided coverage that is available to foreign nationals living and working in the U.S. Over 70% of U.S. employers offer various disability insurance coverage types as part of their employee benefits, which you may qualify for if your company provides them. While this may be a big opportunity for you as a foreign national, it is important to note that group disability insurance policies are mostly underwritten according to the employer’s preference, which often results in limited benefits. Also, group disability insurance policies aren’t portable, meaning your ownership of the coverage ceases the moment you leave the job.
How Individual Disability Insurance Works for Foreign Nationals
As a foreign national, you can get a portable and flexible individual disability insurance policy directly from your preferred insurance company or through a licensed insurance agent. You will have the total liberty of choosing your favorite plan amongst numerous available products and enhance it to meet your personal and family needs.
Individual disability insurance has many features that make it superior group disability insurance and will remain yours even if you have to move from one job to another. Therefore, even if you already have an employer-provided policy, you will still need an individual policy to ensure you and your family are inadequately covered if you have a disability.
Short-term Disability Insurance
Short-term disability insurance plan has a very short elimination period, which allows you to access the benefit between 1 and 7 days after the occurrence of disability. As its name implies, it provides coverage for a limited time—in most cases, between three to six months. It is a good option for a disabling condition that keeps you temporarily away from work. And in the case of long-term or permanent disability condition, it can help fill the gap before other financial protection plans start coming in.
Short-term and Long-term Disability Insurance for Foreign Nationals
Apart from the sources, disability insurance types can also be defined by the length of time for which they provide coverage for policyholders. This can be categorized into two groups: short-term disability insurance and long-term disability insurance.
Long-term Disability Insurance
Long-term disability insurance helps provide financial protection for both short-term and long-term disabilities. It is a more extended income replacement plan that can cover you for several years, sometimes until retirement age or even death, depending on the terms and conditions of the policy. It is a more preferred plan for foreign nationals who can afford it, as it helps cover your expenses if the condition keeps you away from work permanently or for a long period.
What Foreign Nationals Need to Know When Buying Disability Insurance
Your Disability Insurance Needs
Before buying a disability insurance policy, you will have to determine the amount of coverage you will need. Your family size, career, or business interest, and visa status some of the will determine the amount of coverage you will need. Also, your age, occupation, health status, and visa category will determine the type of policies that will be made available to you.
Definition of Disability
This is basically the disability condition that qualifies you for benefit payment. It is usually determined by your ability or inability to work. Some policies are designed to pay benefits if you can no longer perform your primary professional duties even though you are still fit to work in another field. For some, however, they only pay you the benefit if the condition completely prevents you from engaging in any gainful occupation considered to be reasonable for your background.
This means the monthly sum of money you are be entitled to each month if you become disabled. It is usually at least 60% of your pre-disability income.
This is a regular payment you make for your policy, usually paid monthly. This amount is based on the definition of your policy and the quality of features attached to it. It must be paid regularly to ensure your qualification for coverage when the need arises.
Disability Insurance Policy Riders
Just like the cost of living adjustment rider explained above, disability insurance, especially individually-purchased policies, have different features that allow you to enhance your coverage to your personal needs. While these may increase your premium rate, they are, however, good add-ons to your coverage plan. Some of them are:
Non-Cancelable – This means your insurer cannot cancel your policy so long you keep paying your premium unless you request for your policy to be canceled.
Guaranteed Renewable – If your policy is set for a limited period, this feature allows you to renew it if it ends, and you still want the coverage to continue.
How Gold Coast Life Insurance Can Help
At Gold Coast Life Insurance, we help foreign nationals of different visa categories get the best disability insurance coverage, save money on their policy and make the most of it. With us, your age and health condition aren’t any barrier, as we also provide coverage for high-risk applicants with pre-existing medical conditions. Getting a policy that guarantees adequate financial protection for you and your family is as simple as filling this free quote.