Once you have signed up for an insurance policy, the policy holder has to act on the pre-requisites of the policy before receiving lifetime coverage of the policy. This is the elimination period. This is also known as the qualifying period or the waiting period.
Elimination period is the length the length of time between the occurrence of the injury and the receiving of the payments to the beneficiary from the insurer. This refers to the time between the qualification of your claim submitted and the approval or denial of such claim by the insurer.
Elimination Period is most commonly similar to a deductible period in which you need to satisfy first the deductible before the insurance policy will cover the excess expenses above the amount of your deductible.
Typically, elimination period takes 10 days to a year but most insurance policies has an elimination period rates of 90-days. And also some policies may require a continuous or consecutive days of disability from the day the person is injured.
For instance, situations like disability after an injury. Insurance policies will give specific elimination period to its policy holders. Once the elimination period has been satisfied even if the beneficiary is still disabled, the benefits will start immediately.
The length of the elimination period depends on your choice. You have to take into consideration your ability on how to pay for the care expenses. However, you have to take into account that elimination period and the premium rates of the insurance policy are inversely related. The longer the elimination period; the lower the premium will be, while the shorter the elimination period is; the higher the premium will be. Therefore it is good to have longer Elimination period.
What is the purpose of an elimination period?
Elimination period is of the benefit of the insurance companies. This is included in every insurance policy because this will help protect the insurance companies to fraudulent claims and will give them time to investigate the claims made before giving the benefits to the insured party as stated under the terms of the policy. This will save the company from paying unnecessary expenses. This is why insurance companies also offer lower premiums. This also prevents devastating costs of a long period of expensive care.
The benefits to be received on the first day of the loss acquired by the insured party may depend on the terms of your insurance coverage. What does this means? Take for example you have a 70- day elimination period, the benefits will be calculated on the onset of the injury not on the day after the elimination period is complete. It is a must that asp policy holders, you should read the terms and conditions that is written on your policy. This will help the insured understand the nature of paying their deductibles. Policyholders with elimination period in their insurance policy will have a good idea as to when they will be receiving the bigger coverage and when it will commence and how these benefits are determined.