ACCUMULATION PERIOD - An uninterrupted period of consecutive days that begins on the first day that you are disabled and during which the elimination period must be satisfied.

ACTIVITIES OF DAILY LIVING - Dressing - Toileting - Transferring - Continence - Eating - Bathing

AGE - Means your age on your last birthday.

ANY OCCUPATION DEFINITION OF DISABILITY - For the length of the benefit period if due to sickness or injury your inability to work in any reasonable occupation for which you are fit to do based on your education, training, or experience.

AUTOMATIC INCREASE RIDERS - A rider that allows for automatic increases in benefit usually during the first 5-7 years of a policy without medical or financial insurability. You can waive this increase and most carriers eliminate the option if the increases is waived in consecutive years.


BASE MONTHLY BENEFIT - Means the amount paid under the terms of this policy for each month you are totally disabled after the elimination period.

BENEFIT PERIODS - This is the length of time your carrier is obligated to pay you for your disability claim. Typically standard policies are written with an Age 65 - 67 - 70 benefit period. In some cases based on age or medical history carriers will assign a 2, 5, or 10 year benefit period.

BUSINESS EXPENSES - Means the regular business expenses which may be deducted from gross earned income for the period income is being determined 


CATASTROPHIC DISABILITY - A rider that provides an additional benefit in addition to your base monthly benefit for any total disability that limits you from performing 2 out of the 6 activities of daily living (ADL).

CLAIM FORMS - Once the carrier receives notification of the insureds disability they will send claims forms to you within 15 days after the original Disability notification.

COBRA PREMIUM BENEFIT - If you become unemployed as a result of a disability, your carrier may reimburse you for COBRA medical premiums up to limits described in your policy.

CONCURRENT DISABILITIES - When Totally Disability is caused by more than one injury or sickness.

COSMETIC OR TRANSPLANT SURGERY - If this rider is included with your policy, while your policy is in force, if a total disability results from cosmetic surgery to correct a disfigurement or to improve your appearance, the carrier will consider you totally disabled due to sickness, provided the cosmetic surgery occurs more than six months after the issue date.

COST OF LIVING ADJUSTMENT RIDER COLA - Increases to your base monthly benefit after every 12 months of consecutive disability based on a set interest amount or an average of the CPI-U. Each carrier offers different capped increases amounts ranging from 2-10% annually with options for both simple and compounded interest. Most carriers allow for the increases to be purchased if the insured goes back to his/her specialty once they have recovered from a disability.

COVERAGE - Means the benefits available under your policy.

CPI-U - CPI-U is the Consumer Price Index for all urban consumers. It is published by the United States Department of Labor. If the CPI-U is discontinued or if its method of computation is changed, the insurance carriers may use another nationally published index. They will choose an index which is similar in purpose to the CPI-U.

CURRENT INCOME - Current Income means all income for each month during a period of disability. Not including any income received for services rendered prior to the start of disability in your current income. 


DISABILITY - Any injury or sickness that prevents you from maintaining your income or prevents you from performing some or all of the duties of your occupation.

DIVIDENDS - While certain policies are in force a carrier may credit it with dividends. Dividends are usually based on divisible surplus, if any. Dividends are either paid in cash or a credit to premium payments.

DOCTOR - A licensed physician, other than the insured or Owner, parent, spouse, child of the insured or Owner, acting within the scope of his/her license.

DOCTORS CARE - The insured is receiving care by a doctor which, under prevailing medical standards, is appropriate for the condition causing the disability. This requirement is waived once the carrier receives written proof that further Doctor’s Care is no longer of benefit to the insured.

DUTIES - Means all functions that you were performing before the onset of a disability.


ELIMINATION PERIOD - Means the period of time you must be totally disabled before a carrier starts paying benefits.

EXCLUSIONS - Are medical conditions and sometimes lifestyle activities that are excluded from your policy prior to issuing your contract. Every carrier has some basic automatic exclusions related including but not limited to mental/nervous limitations and acts of war.

EXPIRATION DATE - Shown on your policy schedule is the date on which coverage ends.


FULL TIME - Working the equivalent of 30 hours per week.

FUTURE INCREASE OPTION - A rider that allows for guaranteed medical insurability should the insured wish to increase his/her policy in the future. Financial Insurability is required and limits are subject to coverage and participation limits.


GAINFULLY EMPLOYED - Actively at work or engaged in activities for income, remuneration, or profit.

GOOD HEALTH BENEFIT - Elimination period will be reduced by two days for every year you complete without receiving any monthly disability benefits under the policy.

GOVERNING LAW - Any provision in accordance with the state statutes where the insured resides.

GRACE PERIOD - Each Premium after the due date must be paid within 30 - 31 days to keep the Policy In Force. The policy remains In Force during the Grace Period.

GRADED LIFE TIME INDEMINITY - Some carriers offer a graded lifetime option for total disability benefits where they will pay a certain amount of your disability benefit past your Benefit Period for life.

GRADED PREMIUMS - Graded premium options increase annually at guaranteed amounts usually until the policy anniversary following age 60. Applicants are usually given the right to convert from a graded to a level premium structure up until the age of 50 and the new premium is calculated using current attained age.

GUARANTEED RENEWABLE - You can renew your policy until the Expiration Date. During this time, the carrier cannot cancel or change the terms of your policy but the premiums are not guaranteed.


HOSPITAL - Means an institution licensed by law as a facility which: (1)  is primarily engaged in providing in-patient medical care for diagnosis and treatment of injuries or sickness, and charges a fee for such care; and (2)  is staffed by physicians on the premises; and 
 (3)  provides services by registered graduate nurses 24 hours a day.


IN FORCE - Means premiums have been paid when due and you remain insured under the terms of your policy.

INCOME - The compensation that you receive, or which is attributable to you, for work or personal services, after business expenses, but before any other deductions. Income includes salaries, wages, fees, commissions, bonuses, pension and profit sharing contributions, other payments for your personal services, and other compensation or income earned by you or attributable to you by a business in which you have an ownership interest. Income does not include any forms of unearned income except as derived from a business in which you have an ownership interest. With respect to other compensation or income earned by you or attributable to you by a business in which you have an ownership interest, this amount is determined after deduction of normal and customary un-reimbursable business expenses but before deduction of any of your personal income taxes.

INJURY - Means any accidental bodily harm caused by a singular and distinct event occurring while your policy is in force and that is not contributed to by sickness.

ISSUE AGE - Your age at the time of the policy date.

ISSUE DATE - Means the date on which coverage begins.


LAPSE - Means a premium is in default and you are no longer insured under your policy

LIMITATIONS OF COVERAGE WHILE OUTSIDE THE UNITED STATES - Most carriers require that you be living full time in the 50 United States of America, the District of Columbia, or Canada in order to receive benefits under your policy. Some carriers will allow for you to reside outside the United States so long as you remain under the care of a US Doctor.

LOSS - Means an injury, sickness or disability that occurs while your policy is in force upon which a claim is based.

LOSS OF INCOME - Means the difference between your prior income and your current income. This difference will be considered a loss of income to the extent it is solely the result of the injury or sickness that caused your disability.

LOSS PAYEE - The person named in the schedule page to whom benefits will be paid.


MATERIAL AND SUBSTANTIAL DUTIES - The duties which: (1) you are normally required to perform for Your Regular Occupation; and (2) cannot be reasonably omitted or changed.

MAXIMUM BENEFIT PERIOD - Means the maximum length of time a carrier will pay you a base monthly benefit as long as you are totally disabled.

MENTAL NERVOUS DISORDERS - Means any disorder (except dementia resulting from stroke, trauma, infections or degenerative diseases, such as Alzheimer's disease) classified in the Diagnostic and Statistical Manual of Mental Disorders (DSM), published by the American Psychiatric Association, most current as of the start of the period of disability. Such disorders include, but are not limited to, psychotic, emotional, or behavioral disorders, or disorders relatable to stress or to substance abuse or dependency. If the DSM is discontinued or replaced, these disorders will be those classified in the diagnostic manual then in use by the American Psychiatric Association as of the start of a period of disability.

MILITARY DUTY - Some carriers allow for suspension of coverage while in the military. No policy covers a disability related to an Act of War. If on active duty and you continue your disability policy some carriers may cover for non war related disabilities that are not covered by the military.

MODIFIED/TRANSITIONAL OWN OCCUPATION DEFINITION OF DISABILITY - For the length of the benefit period if due to sickness or injury your inability to work in your own occupation and you are not working in any other occupation for wage or profit.

MONTHLY BENEFIT - Base Monthly Benefit or Residual Monthly Benefit as defined in this policy.

MONTHLY INDEMNITY - Is the amount the carrier will pay for each month of total disability.


NON DISABLING INJURY - Some carriers will reimburse medical expenses for non disabling injuries up to outlined coverage limits.

NONCANCELLABLE - You can renew this policy each Policy Year until the Expiration Date. During this time, the carrier cannot cancel or change the terms of your policy or change the premiums shown in the Policy Specifications, as long as you continue to pay premiums on time.

NONPARTICIPATING POLICY - No Dividends are paid under this policy.

NORMAL AND USUAL BUSINESS EXPENSES - Normal and Usual Business Expenses are those expenses that: (1) can be deducted for federal income tax purposes; and (2) are incurred on a regular basis and are essential to the operation of the business. This does not include income taxes; and (3) must not be in excess of the expenses that were incurred before the start of the Elimination Period; and (4) do not include salaries, drawing accounts, profits, benefits and other forms of compensation payable to you or to any member of your immediate family who was not a full-time paid employee of the business during the 180-day period immediately preceding the onset of a Disability.

NOTICE OF CLAIM - A written notice describing the insure’s Disability should be sent to the carriers home office within 20 days after the Disability occurs or as soon as is reasonably possible.


OCCUPATIONAL CLASS - This is the rate class assigned to your occupation at the time you apply for disability benefits and is used by the carrier to determine their internal rate for the risk they feel is associated with your specialty. Each carrier may use a different letter/number combination to describe their own internal rate classes.

OWN SPECIALTY DISABILITY INSURANCE DEFINITION OF DISABILITY - For the length of the benefit period if due to sickness or injury you are prevented from performing the material and substantial duties of your regular occupation you are considered totally disabled even if you are working in another occupation.

OWNER - Means you, the insured, unless records show otherwise.


PARTIAL DISABILITY - The insured is partial disabled if he/she is suffering a current disability and is working in his/her occupation and has had a loss of income of at least 15% - 20% (depending on your contract) and is under a Doctor’s Care.

PARTICIPATING POLICY - A policy that provides dividends to its policyholders

PHYSICIAN - Means a person (other than you, your spouse or domestic partner, a member of your family, a business or professional partner or any person with whom you share a financial or business interest) licensed by law in the state in which he or she practices and who is practicing within the scope of such license to treat injury or sickness. If a loss is due to mental/nervous disorders, the physician must be a board-certified psychiatrist or a licensed doctoral-level psychologist.

POLICY - The legal contract between you and the insurance carrier. The entire contract consists of the policy, any applications, the schedule pages and any attached riders, amendments, and endorsements.

POLICY ANNIVERSARY - The yearly anniversary of the policy date while the policy remains in force.

POLICY DATE - Means the date from which policy anniversaries, policy years and premium due dates are determined.

PRE-EXISTING CONDITIONS - As long as pre-existing conditions have been fully disclosed and they are not specifically excluded, they will be covered.

PRESUMED TOTAL DISABILITY - The insured is Presumptively Totally Disabled when Sickness or Injury causes a permanent loss where the waiting/elimination periods can be waived. Some carriers will waive the waiting period even if the Sickness or Injury is not considered a permanent situation for the following: Speech - Hearing in both ears - Sight in both eyes - use of both hands - use of both feet - or use of one hand and one foot.

PRIOR INCOME - Depending on the provisions in your contract means your average monthly income for either the last 12 to 24 calendar months just prior to the date on which you became disabled. 

PROOF - Means records and statements, including but not limited to tax records, medical records, employment records, and financial records.

PROOF OF GOOD HEALTH - If your application/underwriting process took a long time. The insurance carrier might ask you to sign a document that proves you are still in good health and that their have been no changes in your medical condition since you began appling for coverage.

PROOF OF INSURABILITY - Proof of insurability is also referred to as Evidence of Insurability. This is where the insurance carrier is provided with your current and past medical hisotry in order to determin you are eligible to qualify for new insurance.


RECURRENT DISABILITIES - A recurring disability is a related disability that starts less than 2 months after a period of disability ends. A recurring Disability does not receive a new Maximum Benefit Period and no new waiting period is required.

REHABILITATION - You will not normally be considered recovered from a total disability just because you participate in a program of occupational rehabilitation. Some carriers allow you to request or they may suggest that you participate in a formal, supervised rehabilitation program designed to help you return to an occupation. If both parties mutually agree that such a program is appropriate, the carrier will pay expenses as set forth in a signed, written agreement between you and them.

REINSTATEMENT - The policy will terminate if premiums are not paid within the Grace Period. Reinstatement may include a new application and proof of medical and financial insurability. Reinstatement requires the payment of back premiums. New exclusions, endorsements, limitations, and even denial of coverage may be added to a policy that is reinstated along with a new contemptibility period.

RENEWABILITY - If your policy is non-cancellable and guaranteed renewable to age 65 (or age 67-70 if this benefit period is selected). After this time period the base contract is conditionally renewable at attained age premiums after the expiration date as long as the insured is gainfully employed full-time (30 hours per week minimum) for at least 10 months each year and the premium is paid on time.

RESIDUAL DISABILITY OR RESIDUALLY DISABLED - Residual Disability or Residually Disabled means that due to Sickness or Injury: (1) you are not Totally Disabled; and (2) you are working in Your Regular Occupation; and (3) you have a loss of Monthly Earnings that is at least 20% of your Monthly Earnings Before Disability; and (4) your loss of Monthly Earnings is solely the result, directly and apart from any other cause, of an Injury or Sickness; and (5) you are able to perform one or more, but not all, of the Material and Substantial Duties of Your Regular Occupation or you are able to work in Your Regular Occupation no more than 80% of the time you formerly spent before your current Disability started; and (6) you meet the Regular Care of a Physician provision.

RESIDUAL MONTHLY BENEFIT - The monthly benefit amount to be paid for each month you are Residually Disabled after the Elimination Period.


SCHEDULE - Means the policy schedule or revised policy schedule most recently sent to you by us that includes a summary of your benefits and premiums.

SICKNESS - Means any illness or disease first manifested while this policy is in force, including complications due to pregnancy or childbirth.

STEP PREMIUMS - Step Rate premiums normally only guarantees the premium and remains level for five years or until an insureds age of 35, whichever is later.

SURVIVOR BENEFIT - If you die after satisfying the elimination period and while monthly disability benefits are being paid under your policy, the carrier will pay an additional three months of base monthly benefit, as shown on your policy schedule. This benefit is in addition to any other benefit of your policy. The benefit is payable to your designated beneficiary, if any, otherwise, to your estate.

SUSPENSION PERIOD - A period of time during which the policy will not be in force. The carrier will neither accept premiums nor pay benefits under the policy during a suspension period. The policy will not cover losses that result from injury or sickness that occurs or begins during a suspension period. 


TERMINATION DATE - The date on which the policy terminates

TOTAL DISABILITY OR TOTALLY DISABLED - The definition that describes when a carrier is obligated to pay you your full monthly benefit.


UNEARNED INCOME - May include but not limited to: Investment income; Rent; deferred compensation plans; retirement income; other disability income benefits; or royalties. Gross earnings are not included that the insured receives from his/her personal activity in any profession.


VOLUNTARY SUSPENSION DURING UNEMPLOYMENT - Some carriers allow for you to suspend your policy during brief periods of unemployment and allow you to resume again when full time work is re-established. No coverage is provided during this period.


WAITING PERIOD - Means the period of time you must be totally disabled before a carrier starts paying benefits.

WAIVER OF PREMIUM - Premium payments are waived upon approval of your claim, after you have been continuously disabled for at least 90 days. Any premiums paid beginning with the date of disability will be refunded.

WE, OUR, US - Referring to the insurance carrier

WRITTEN REQUEST - A request in writing in a form satisfactory to the insurance company and received at their home office.


YOU, YOUR - Referring to you the insured.

YOUR OCCUPATION - The insureds regular profession(s) or business(es) at the start of Disability

YOUR REGULAR OCCUPATION - The occupation (or occupations if more than one) in which you are regularly engaged at the time Disability began. If Your Regular Occupation at the time Disability began is limited to a Board Certified Specialty within the scope of your degree or license, we will deem that Specialty to be Your Regular Occupation. If you are not working at the time Disability began, Your Regular Occupation means any occupation you are able to do based on your education, training and experience.

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