Short-Term Disability Insurance

Returning from the Quick Tip Week refreshed, I’m ready to start and finish another category in our document organization.

We are in the home stretch in organizing our insurance paperwork in Box 2 of our important documents.

Kept within the tenth file opening are the documents for our short-term disability insurance which makes up our eighth category in our insurance filing system.

Short Term Disability Insurance

Defined

This type of policy protects Paul’s paycheck should he become disabled. Short term disability insurance is typically more expensive than long-term disability since you have a greater chance of using short-term than long-term.

Our policy will pay us 60% of Paul’s paycheck from day 7-90 should he become disabled. Our short-term policy covers the first 3 months before our long-term insurance takes effect. Each policy has different options, but this is a typical policy.

Documents

For this policy, I keep the following documents in this tenth file opening of our insurance file box:

1. Summary Page: This one-page document has the administrator’s contact information, our policy number, and instructions for filing claims.

2. Policy: Approximately 15 pages in length, this document lists our coverage, claim information, and limits.

3. Notifications: Currently, we carry a policy with the largest coverage allowed. We started out with 40% coverage and have inched it up to the 60% limit. With each increase, our policyholder has approved our request and sent notification of the changes.

4. Correspondence: Since Paul’s employer changed providers a few years ago and the rates were better with the new company, we switched our policy to the new provider to save money and stay in the group options. I keep the documents from our former contract should I need that information.

5. Release Authorization: Since Paul is the insured, the provider required his authorization before releasing information to me. In making the calls and keeping the documents, I periodically need information from the company. To prevent frustration with agents, Paul authorized a permanent release for me.

These documents placed together stay in this eighth category of our insurance documents.

If you have a short-term disability policy, then gather those documents and place them in this file. If you don’t have this policy and hope to have one, then create a label and leave an empty space in your file for the future. Easy peasy!

With another category complete, we only have one more category to complete file box 2. Keep up the good work. Happy organizing!

Question: Do you carry a short-term disability policy?