My client Linda had no short-term disability insurance. So when she fell and broke her leg while jogging one weekend, surgery and rehabilitation were essential. Linda’s major medical health insurance policy paid the hospital and doctors their bills. Fortunately three years prior to this accident, Linda got a stand-alone accident policy. She received a check from the insurance company for $10,000. This helped pay off her deductible, maximum out of pocket co-insurance, and living expenses for the next four weeks she was unable to work. The accident policy helped save Linda from using up all of the little money she had in her savings account.
Living Benefits (formally known as Supplemental and also referred to as “Gap” or “Indemnity”) insurance policies are separate stand-alone policies that provide a cash benefit to you in the event you have an accident, cancer, heart attack or a stroke. Some carriers offer the option of a rider that includes certain major illnesses such as: multiple sclerosis, botulism, or sickle cell anemia to name a few. The advantage of these types of policies is that the cash you receive can be used to pay your high deductible (if you have a high deductible health insurance plan) and other out-of-pocket expenses. You may also have money to cover some of your everyday living expenses.
