How to Insure Your Income: Lifetime Benefits

This option extends your benefit period from age 65 to your lifetime. (The extension may apply to accident-only benefits.)

Normally, if the total disability is due to an accident and it occurs prior to age 65, benefits will be paid for the lifetime of the insured, provided he or she remains totally disabled.

Most companies will place some time limitations on the lifetime sickness benefit. That is, the disabling sickness must begin prior to a specified age -- such as 50 or 55. A policy providing lifetime sickness benefits may stipulate that if the sickness begins at age 55 or earlier, then 100 percent of the total disability benefit will be provided for the lifetime of the insured person. If the disability begins after age 55, a reduced benefit will be paid for life.

For example, a policy might state the following:

If total disability, due to sickness, begins at age 55 or earlier, total disability benefits will be paid for the lifetime of the insured. If total disability benefits begin at age:

• 56 -- total benefits are paid to age 65; then 90 percent of the benefit for the lifetime of the insured;
• 57 -- total benefits are paid to age 65; then 80 percent of the benefit for the lifetime of the insured;
• 58 -- total benefits are paid to age 65; then 70 percent of the benefit for the lifetime of the insured...

The progression of benefits would continue in this manner until age 65. If the total disability began at age 65 (normally, the policy is not renewed past age 65), then the payment of total disability benefits would be limited to one or two years.