Individual Coverage – Term and Whole Life Insurance
Life Insurance – The longstanding purpose of this policy has been to provide funds to the beneficiary (usually family members) to create, preserve or liquidate an estate. The most common types of plans are either term insurance – which has a death benefit only or “whole life” – which has a death benefit and may build up a cash value. There are now options so it may be used for long term funding (e.g. a whole life policy for a child so that the cash value may be used for college when he or she reaches an attained age) or the funding of trusts. Some plans now offer “rider” (enhancement to the policy) which provides coverage for long term care in addition to the other benefits of the policy.
Disability Policy – This policy provides income protection in the event of non-occupational illnesses and injuries. Some disability plans also offer supplemental payments to the indemnity (lost wages) portion of Workers’ Compensation accidents or injuries. Disability policies may be purchased for short term or long term loss of income from injuries or illnesses.
Long Term Care – This policy fills the gap that occurs in medical plans. It is often discussed in the context of aging but it may apply to any circumstance that requires rehabilitation or extended therapy at any age. Typically, medical plans have very limited coverage for extended rehabilitation that may be required.
The definitions above are intended for information purposes only. Actual policy terms, conditions and exclusions of the actual polices may alter the definitions provided.