A cancer diagnosis can quickly change the course of your life. One of those changes may be your ability to work and earn an income. Family finances are often stretched from the added medical expenses, and loss of income. So it is natural to ask “does short term disability insurance cover cancer?”
Cancer is one of the most frequently covered disability qualifying conditions. Understand how your policy works, and how common policy definitions may be applied to cancer patients.
- Purchasing a policy with cancer
- Preexisting and qualifying conditions
- Applying for policy benefits with cancer
- Recurrent and partial disabilities
Purchasing Disability Insurance with Cancer
One of the most difficult truths faced by insurance agents is the motivation to purchase any insurance product is greatest when a person becomes sick. The need is then both urgent and profound. The Affordable Care Act requires health insurance to cover preexisting medical conditions with no waiting period. But the new law does not apply to short term disability insurance.
If you were diagnosed with cancer before purchasing a policy it will be difficult but not impossible to purchase a policy, and have it cover your cancer. There are two hurdles to overcome: qualifying for coverage, and avoiding preexisting condition limitations. You can also learn more about insurance after a cancer diagnosis on a related post.
Qualifying for Coverage
There are many form of short term disability coverage: individual, voluntary, and group plans. Each has its own set of qualifying medical criteria. Expect to be asked a qualifying question such as: “Within the last 5 years, have you received medical advice or sought treatment for cancer of any form, other than skin cancer”. If your answer is yes, you may not be able to purchase a policy unless your employer offers a guaranteed issue option.
Preexisting Condition Limitations
Many group and voluntary plans allow for guarantee issue. When enough employees participate in the plan, the carriers will accept new applicants regardless of medical history. Benefit amounts may be limited, and preexisting condition limits may apply to new policyholders with cancer.
A short term disability preexisting condition may be defined as having a medical condition for which you were treated, received medical advice, or took medication within twelve months of the policy effective date. If your cancer has been in remission for twelve months, this clause may not apply. If the clause does apply there is a second policy definition that may come into play.
If you become disabled due to a preexisting condition within the first twelve months the policy is in force, then the policy may not pay benefits. However if your preexisting cancer causes you to become disabled after the twelve months have elapsed, the policy may have to cover that period of disability. Each policy has different language for preexisting conditions. Read your policy language carefully.
Applying for Disability Benefits with Cancer
For those who had coverage in force prior to begin diagnosed with cancer, there are important short term disability policy definitions to understand. Each definition helps determine how much income replacement benefit you may receive. Understanding how these definitions work can help you get the most from your policy while undergoing cancer treatments.
Policy knowledge is your best weapon for working through claims disputes. The same holds true for anyone holding a supplemental cancer insurance policy.
Common Policy Definitions
There are three policy definitions common throughout the industry that will come into play for anyone disabled due to cancer. The elimination period defines how long you must be disabled before benefit payments begin. The monthly benefit amount defines your level of income replacement. Most policies will limit this amount to 2/3 of income or less. The benefit duration defines how long benefits last while you are continuously disabled.
Recurrent and New Disability Definitions
During treatment for cancer your ability to work may cycle through hills and valleys. There may be times when you can’t work at all, periods when you can only work part time, and times when you are able to return full time.
The recurrent disability definition may become the most important concept to understand. Policyholders may undergo cancer treatments over the course of many years. There may be a period of disability, followed by a period of recovery, followed by another period of disability, etc. Each time you need to stop working again, your policy defines whether that is considered a new disability, or recurrent disability.
Your policy may define a recurrent disability as a continuation of the previous disability if you have returned to work for less than six months. With a recurrent disability you do not have to satisfy the elimination period again, and a new benefit period does not apply.
Your policy may define a new disability when you returned to work for more than six months, working the same number of hours before the previous disability began. With a new disability you must satisfy the elimination period again, and a new benefit period applies.
Partial Disability Definitions
During a bout with cancer there may be times when you can only work part-time. Patients undergoing radiation and chemotherapy often do not have the stamina to work a full schedule, or their treatments occur during work hours. You can learn more about working during cancer treatments on another site.
Your policy may define a partial disability as being able to work your regular occupation for 20 hours per week or less. There may be a reduced benefit amount paid for partial disabilities, and there may be a requirement that you be totally disabled for at least one month prior to being partially disabled.
Waiver of Premium
Cancer treatments can be debilitating physically and financially. In addition to lost income, there may be other expenses as well. Make sure that you continue making premium payments while disabled. Your policy may contain a waiver of premium benefit. The benefit may waive the premiums if you have been continuously disabled for 90 days or longer. Every penny counts when you are battling cancer.
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