What is typically a key feature of long-term disability policies?

A key feature of long-term disability policies is the presence of a waiting period before benefits begin. This waiting period, often referred to as an elimination period, is the amount of time that must elapse after a disability occurs before the policy begins to pay benefits. This feature is essential because it helps to ensure that the policyholder is truly in need of long-term assistance rather than experiencing a temporary condition.

The waiting period can vary between policies, commonly lasting from a few weeks to several months, and it helps to mitigate costs for insurance companies by limiting payouts for short-term disabilities. This feature reflects a common industry standard designed to balance the insurer's risk with the insured individual's need for coverage.

Payments starting immediately after claim approval would typically characterize short-term disability policies rather than long-term ones, making that option less relevant. Premiums being the same for all ages would not accurately reflect the risk variations insurance companies analyze, particularly in long-term disability. Benefits being paid for the rest of the insured's life can also be conflated with permanent policies but does not typically apply to long-term disability policies, which usually provide benefits for a specified period, such as until retirement age or for a certain number of years.