How to Insure Your Income: "Total Disability"

The definition of total disability is a primary place that insurance companies can help control disability claims. There is currently a trend away from the your occupation definition of total disability for all occupational classes. The any occupation definition lessens the impact of a potential claim, since the claimant will go off claim if he or she moves to another occupation.

Some insurers use a combination of the two definitions, under which a person is covered on a your occupation basis for a few years and, if the claim continues longer, the definition changes to any occupation.

Benefits for your occupation policies are the result of the inability to perform functions of a particular job. Basically, the disability income policy is insuring job functions, when it should be replacing lost income due to a disability.

The residual approach to disability income coverage also plays a role in this remedy. Paying a proportionate benefit instead of a full benefit -- thus providing an incentive for the individual to attempt a return to work -- reduces the size and duration of a claim.