Short Term Vs Long
Term Disability Insurance
  • Short and Long Term
  • Riders For Disability
  • Importance of a Rider
Short Term Vs Long Term Disability Insurance
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Difference Between Short Term and Long Term Disability Insurance

Disability insurance helps individuals safeguard against unexpected disabilities that could result in financial difficulties. Replacing a portion of lost income in disability makes it an important safety net. When thinking about purchasing a policy for a potential income loss due to a disabling condition, it’s important to understand that there are only two types of coverage available: short term and long term. Even though both serve to protect against loss of income resulting from disability, they contrast in the extent of coverage offered, duration and criteria for eligibility. In this article, we will cover short-term disability, long term disability, disability riders and how important it is to include riders when securing protection for disabled individuals.

Disability Insurance Or Disability Rider?

It is important to know that there are no insurance policies that are exclusively available for disabled individuals. When someone says short-term insurance or long-term insurance, they mean normal insurance with a disability rider along with it. It is also necessary to know that individuals who already have a disability cannot opt for a disability rider. But if you are someone who doesn’t have a disability but wants to be secure for the future, term insurance with a disability rider is a great option.

Understanding Short Term Disability Insurance

A short-term disability rider offers a limited-time coverage that typically ranges from several weeks to multiple months (temporary disability). Its design aims to shield individuals against temporary disabilities that stop them from working during a certain recovery period. This kind of rider commonly covers a portion of the insured individual's pre-disability pay or salary, offering them monetary support while they recover. Short-term disability insurance targets individuals without an existing condition. To determine an individual's eligibility for coverage, insurance companies usually require them to undergo medical underwriting and have their health examined. People with any disability, even minor ones, may struggle to get short term disability insurance. Any disabilities discovered during the underwriting process could result in insurers rejecting the policy application or excluding disability coverage.

Understanding Long Term Disability Insurance

Long-term disability insurance differs from short term-disability. Long-term disability provides coverage over a longer period for a permanent disability. If your disability continues after your short-term policy ends, this insurance provides income replacement. After a short or long waiting period, depending on the policy terms, most long-term disability insurance policies will kick in. Just like short term disability insurance, long term also demands applicants to pass through the process of medical underwriting. People with pre-existing disabilities may not qualify for long-term disability coverage.

Difference Between Short-Term Disability Rider And Long-Term Disability

The following is the point of difference between short term and long term disability:

ParametersShort-Term Disability Insurance Long-Term Disability Insurance
Who should OptPeople with temporary disabilityPeople with disabilities that would last years or a lifetime
Waiting Period0-14 DaysMay take upto several weeks
Premium RatesLower PremiumHigher Premium
CoverageSeveral weeks to 2 years MaximumSeveral years

Riders For Disability

Term insurance policies can be enhanced by adding riders that provide extra coverage or address specific needs. There are two riders that assist with disabilities, the disability rider and the waiver of premium rider.

  • Disability Rider

    Expanding the coverage of your disability insurance policy with a rider can provide protection for disabilities resulting from accidents or illnesses excluded in the standard plan. With this rider, individuals can claim benefits for a broader range of disabilities, providing them with a wider safety net.
  • Waiver of Premium (accidental) Rider

    The accidental waiver of premium rider allows the policyholder to stop paying premiums on their term insurance in case of a disability. When a qualifying disability occurs. This rider ensures that the policyholder is not burdened with financial difficulties when they cannot work due to being disabled. For example: If you had this rider and in future had a disability due to an accident, you can claim this and you won’t have to pay your future premiums. It is necessary to note that you won’t be getting any money but you won’t have to pay the future premiums. The term policy will continue as it is and the sum assured will remain the same.

The presence of riders can offer great advantages to people with disabilities. While insurance plans targeted towards those with disabilities may not exist, riders allow for personalised coverage options. Individuals can get coverage by including a disability rider in their standard term insurance.

Importance of Opting For Term Insurance With Disability Rider

For people with disabilities having additional coverage by including a disability rider can be very beneficial. A disability rider is important because of the following reasons:

  • Financial Security: An extra layer of financial security is guaranteed when you have a Disability rider in case you are unable to work.
  • Customizable: Disability riders provide flexibility to customise coverage to your specific requirements.
  • Peace Of Mind: Knowing that you are protected by a disability rider brings peace of mind. You can put your mind at ease about.

Plans With Diasbility Rider

  • HDFC Life Click 2 Protect Super
  • Bajaj Allianz Life Smart Protection Goal
  • ICICI Pru iProtect Smart
  • Max Life Smart Secure Plus
  • IndiaFirst Life Guaranteed Protection Plus Plan
  • Aegon Life iTerm Plus Insurance Plan
  • Canara HSBC Life iSelect Smart360
  • Tata AIA SRS Vitality Protect
  • PNB MetLife Mera Term Plus
  • Edelweiss Tokio Total Protect Plus

A term plan that offers all-around protection to the policyholder as it protects against 36 critical illnesses, accidental death benefits, etc.

Unique Features

  • Life Stage Option
  • Multiple Coverage Options
  • Increasing Death Benefit

HDFC Life Click 2 Protect Super (Pros)

  • Terminal Illness Benefit
  • Smart Exit Benefit
  • Acceleration Death Benefit

HDFC Life Click 2 Protect Super (Cons)

  • 1 Year WP for Suicide
  • No Policy Loans
  • No Pre-existing Conditions

HDFC Life Click 2 Protect Super (Other Benefits)

  • Death Benefit in Instalments
  • RP, WOP & 3 Riders
  • Additional Cover for Spouse

HDFC Life Click 2 Protect Super (Eligibility Criteria)

  • Entry Age -18 Years
  • Max Entry Age - 84 years
  • Minimum Sum Assured - INR 5,000
  • Maximum Maturity Age - 85 years
  • Premium Payment Term - RP/SP/LP

The comprehensive plan offers death coverage, accidental death coverage, Cancer cover benefits, and Waiver of Premium on Critical Illness Benefits.

Unique Features

  • (ROP) as Maturity Benefit
  • Whole Life cover
  • Waiver of Premium Benefit

Smart Protection Goal (Pros)

  • Critical Illness Benefit
  • Accidental Death Benefit (ADB)
  • Accidental Total Permanent Disability Benefit

Smart Protection Goal (Cons)

  • No Loans Allowed
  • 180 Days WP For Critical Illness
  • No Rebate for SA above 3 cr

Smart Protection Goal (Other Benefits)

  • Suicide Cover After 12 Months
  • Female Life Rebate
  • High Sum Assured Rebate (HSAR)

Smart Protection Goal (Eligibility Criteria)

  • Entry Age -18 Years
  • Max Entry Age- 65 Years
  • Min Sum Assured - 5 L
  • Max Maturity Age - 75 Yrs(ROP)
  • Premium Payment Term - RP/SP/LP

This plan offers an optional accidental death benefit of up to 2 crores, extended coverage until age 99, and includes coverage for Covid-19 claims.

Unique Features

  • Unlimited Maximum Sum Assured
  • Smart Exit Benefit
  • Waiver of Premium Benefit

iProtect Smart Term Plan (Pros)

  • Major Organ Benefit
  • Accelerated Critical Illness Benefit
  • Choose your Policy Term

iProtect Smart Term Plan (Cons)

  • No Loans Allowed
  • Modal Loadings
  • No Maturity Benefit

iProtect Smart Term Plan (Other Benefits)

  • Brain and Nervous System Benefit
  • Heart and Artery Benefit
  • Terminal Illness and Disability Enhanced Protection

iProtect Smart Term Plan (Eligibility Criteria)

  • Entry Age -18 Years
  • Max Entry Age- 65 Years
  • Minimum Sum Assured - NA
  • Maximum Maturity Age - 75 Years
  • Premium Payment Term - RP/SP/LP

Offers financial security and a support system to the policyholder in an emergency. Provides a 5% increment in SA after every anniversary of the policy.

Unique Features

  • Life Stage Option
  • Multiple Coverage Options
  • Increasing Death Benefit

Smart Secure Plus Plan (Pros)

  • Terminal Illness Benefit
  • Smart Exit Benefit
  • Acceleration Death Benefit

Smart Secure Plus Plan (Cons)

  • 1 Year WP for Suicide
  • No Policy Loans
  • No Pre-existing Conditions

Smart Secure Plus Plan (Other Benefits)

  • Death Benefit in Instalments
  • RP, WOP & 3 Riders
  • Additional Cover for Spouse

Smart Secure Plus Plan (Eligibility Criteria)

  • Entry Age - 18 Years
  • Max Entry Age - 84 years
  • Minimum Sum Assured - Adaptable
  • Maximum Maturity Age - 85 years
  • Premium Payment Term - RP/SP/LP

A pure term plan insurance that offers flexible premium payment options, and innovative coverage features and return of premium option.

Unique Features

  • Return of Premiums of maturity
  • Coverage till 100 years
  • Spouse coverage under same plan

Life Guaranteed Protection Plan (Pros)

  • 1 Crore Cover
  • 3 Plan Options
  • WoP Premium for 40 Critical Illnesses

Life Guaranteed Protection Plan (Cons)

  • 1 Year WP For Suicide
  • No Rider Benefit
  • No Pre-Existing Conditions

Life Guaranteed Protection Plan (Other Benefits)

  • Whole Life Cover (Till Age 99)
  • WOP Option For Disability
  • Adjust SA With Life Stage

Life Guaranteed Protection Plan (Eligibility Criteria)

  • Entry Age -18 Years
  • Max Entry Age- 65 Years
  • Minimum Sum Assured - 50L
  • Maximum Maturity Age - 99 yrs
  • Premium Payment Term - 5 To 35 Years

Bandhan Life iTerm Plan

A cost-effective and comprehensive online term insurance plan which comes with inbuilt terminal illness benefit.

Unique Features

  • Death Benefit Payout
  • InstaCover benefit
  • High sum assured

A Non-Linked, Non-Participating, Individual, Pure Risk plan that offers 3 plan options with steady income benefits.

Unique Features

  • Life cover till 99 years
  • Child Care Benefit option
  • Income Benefit after 60 years

iSelect Smart360 Term Plan (Pros)

  • 3 Plan Options & Spouse Cover
  • Accidental Death Benefit
  • Accidental Total & Permanent Disability

iSelect Smart360 Term Plan (Cons)

  • No Policy Loan Allowed
  • No Maturity Benefit
  • No Benefit On Revival

iSelect Smart360 Term Plan (Other Benefits)

  • Critical & Terminal Illness
  • Option To Block Your Premium
  • 5% Loyalty Discount

iSelect Smart360 Term Plan (Eligibility Criteria)

  • Entry Age -18 Years
  • Max Entry Age- 65 Years
  • Minimum Sum Assured - 25 L
  • Maximum Maturity Age - 81 Yrs
  • Premium Payment Term - RP/SP/LP(5&25 Years)

An all-inclusive plan that comes with mental and physical wellness features, discount on premium, early rewards and high sum assured of 2 crores.

Unique Features

  • Life Coverage With Term Booster
  • Wellness Based Discount
  • Rider Sum Assured Boosters

SRS Vitality Protect (Pros)

  • 10% Guaranteed Discount
  • Wellness Rewards Program
  • Guaranteed 1st Year Discount

SRS Vitality Protect (Cons)

  • No Plan Conversion Option
  • No Maturity Benefit
  • Limited Premium Payment Terms

SRS Vitality Protect (Other Benefits)

  • 75% SA Terminal Illness Coverage
  • Cover Boosters
  • Up To 30% Rider Premium Discount

SRS Vitality Protect (Eligibility Criteria)

  • Entry Age - 18 years
  • Max Entry Age - 65 years
  • Minimum Sum Assured - 50 L
  • Max Maturity Age 100Yrs
  • Premium Payment Term - (5-81 Yrs) LP/RP/SP

Offers financial protection to your loved ones and gives the flexibility to customize the plan according to your needs.

Unique Features

  • Tax Benefits
  • Joint Life Cover
  • Critical illness benefit

Mera Term Plan Plus (Pros)

  • Terminal Illness
  • Waiver Of Premium on (ATPD)
  • Accelerated Critical Illness Benefit

Mera Term Plan Plus (Cons)

  • No Policy Discount
  • No Policy Loan Allowed
  • No Maturity Benefit Without ROP Option

Mera Term Plan Plus (Other Benefits)

  • 4 Rider Option
  • 10% Step-up Benefit
  • Rebate on High Sum Assured

Mera Term Plan Plus (Eligibility Criteria)

  • Entry Age -18 Years
  • Max Entry Age- 65 Years
  • Min Sum Assured - 25L
  • Premium Payment Term - SP/RP/LP
  • Maturity Age - 99 years (Whole Life)

Edelweiss Tokio Total Protect Plus

Provides all-round financial protection to your family in your absence. It also provides coverage to your better half in the same plan at a little extra cost.

Unique Features

  • Return of Premium Option
  • Flexible Death Benefit Payment
  • Early Exit Benefit

Total Protect Plus (Pros)

  • Convertible Premium Paying Term
  • 4 Add-On Riders
  • Suicide Claim

Total Protect Plus (Cons)

  • No Loan Benefit
  • Reduced Paid-up Benefit
  • No Surrender Benefit For Life Cover

Total Protect Plus (Other Benefits)

  • Better Half Benefit
  • Critical Illness Rider
  • Life-Hospital Cash Benefit Rider

Total Protect Plus (Eligibility Criteria)

  • Entry Age - 18 years
  • Max Entry Age - 65 years
  • Minimum Sum Assured - 25 L
  • Maximum Maturity Age - 75 Years
  • Premium Payment Term - 5 to 25 Years

Top 10 Term Insurance Plans for Disability Rider With Eligibility

Term Insurance Plans

Entry Age

Maturity Age

Minimum Sum Assured

ICICI Pru iProtect Smart18 years to 65 years75 years50 Lakhs
HDFC Life Click 2 Protect Super18 years to 65 years85 years50 Lakhs
Bajaj Allianz Life Smart Protection Goal 18 years to 65 years75 years5 Lakhs
Max Life Smart Secure Plus18 years to 65 years85 years20 Lakhs
Canara HSBC Life iSelect Smart36018 years to 65 years99 years50 Lakhs
IndiaFirst Life Guaranteed Protection Plus Plan18 years to 65 years99 years50 Lakhs
Tata AIA SRS Vitality Protect18 years to 65 years100 years50 Lakhs
PNB MetLife Mera Term Plus18 years to 60 years99 years25 Lakhs
Edelweiss Tokio Total Protect Plus18 years to 55 years100 years25 Lakhs
Aegon Life iTerm Plus Insurance Plan18 Years to 65 years80 years50 Thousand

Conclusion

Essential knowledge for those seeking financial protection against disabilities includes understanding the variations between short- and long-term disability insurance. While short term-disability insurances cover temporary disabilities, long term-disability insurances offer protection against extensive periods. People who have existing disabilities might encounter difficulties when trying to get disability insurance. In any case, including riders like the disability rider and waiver of premium rider may aid in resolving this matter. These riders enable individuals to tailor their policies for comprehensive coverage and establish financial security against any potential loss of income due to a disability.

Short Term Vs Long Term Disability Insurance: FAQ's

1. Arе thеrе spеcific insurancе policiеs for disablеd individuals?

No, thеrе arе no insurancе policiеs еxclusivеly dеsignеd for disablеd individuals. Whеn rеfеrring to short-tеrm or long-tеrm insurancе, it mеans rеgular insurancе with a disability ridеr addеd to it. Individuals with еxisting disabilitiеs cannot opt for a disability ridеr, but those without disabilitiеs can include it in their tеrm insurancе policy.

2. What is short-term disability insurancе?

Short-tеrm disability insurancе offеrs tеmporary covеragе for a limitеd pеriod, typically ranging from wееks to months. It providеs financial support to individuals who arе tеmporarily unable to work due to a disability, covеring a portion of their prе-disability incomе.

3. How do long-tеrm disability insurancе differ from short-tеrm disability insurancе?

Long-tеrm disability insurancе providеs covеragе ovеr an еxtеndеd pеriod for pеrmanеnt disabilitiеs. It rеplacеs incomе aftеr thе short-tеrm policy еnds, offеring protеction for disabilitiеs that last yеars or a lifеtimе. It usually has a waiting pеriod before thе covеragе kicks in.

4. What arе ridеrs for disability insurancе?

Ridеrs arе additional fеaturеs that can bе addеd to tеrm insurancе policiеs to еnhancе covеragе or addrеss spеcific nееds. Two ridеrs rеlatеd to disabilitiеs arе thе disability ridеr and thе waivеr of prеmium ridеr. Thе disability ridеr еxpands covеragе for a broadеr range of disabilitiеs, whilе thе waivеr of thе prеmium ridеr еxеmpts thе policyholdеr from paying prеmiums in casе of a disability.

5. Why is it important to include a disability ridеr in tеrm insurancе?

Including a disability ridеr in tеrm insurancе providеs an еxtra layеr of financial sеcurity. It hеlps rеplacе lost incomе, maintain financial stability, and covеr mеdical еxpеnsеs in casе of disability. Disability ridеrs also offеr flеxibility to customizе covеragе based on spеcific rеquirеmеnts and providе pеacе of mind by planning for unforеsееn еvеnts.

6. Can I purchase both short-term and long-term disability insurance policies simultaneously?

Yes, it is possible to have both short-term and long-term disability insurance policies simultaneously.

7. Can I customize the coverage duration for disability insurance riders?

Yes, many disability insurance riders offer flexibility in choosing the period lenghth and the waiting time before activation.

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May 20, 2024

SUD Life term plan truly stands out my expectations as I got SUD Life term plan along with additional riders at very affordable premiums.

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May 20, 2024

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Indore

May 17, 2024

PolicyX’s dedicated support made renewing my Bandhan Life Insurance policy easy. I’m absolutely delighted with the service offered by PolicyX Insurance Advisor.

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May 17, 2024

I bought a Bandhan Life Insurance through PolicyX, and I must say the level of communication and assistance I have received has been truly impressive.

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Bhopal

May 17, 2024

After getting advice from the PolicyX experts, I chose a Bandhan Life Insurance term plan. Thank you, PolicyX, for helping me buy a term plan at such a low premium.

Simran Kaur Vij

Written By: Simran Kaur Vij

Simran is an insurance expert with more than 3 years of experience in the industry. She may have all the answers to your insurance queries. With a background in Banking, she proactively helps her readers to stay on par with all the latest Insurance industry developments.