Disability insurance elimination period

Find out how long you’ll need to wait before your disability benefits kick in.


Red pin stuck in calendar

Also known as the “waiting period,” the elimination period is the length of time before you start receiving benefits. It’s up to you to decide how long you want this period to last.

What is the elimination period?

The elimination period – often used interchangeably with the term “waiting period” – is the amount of time you’ll need to wait before your disability benefits start paying out. During this time, you’ll have to cover your own living and medical expenses.

Think of it like a car insurance deductible. But instead of having to pay a certain amount of money before your insurer steps in, it’s measured by time.

Once the elimination period has passed, you’ll receive your first monthly cheque from your insurer — assuming you meet their definition of partial or total disability.

How does the elimination period work?

When you apply for a disability policy, you’ll be given a choice of elimination periods. The most common elimination period is 90-120 days — which means your benefits won’t be paid out for 3 or 4 months — but the options available to you will depend on your insurer and policy.

  • Short-term disability. Short-term disability policies cover short-term needs, so there’s typically less time to wait before you start receiving benefits. Most policies have an elimination period of 1-10 days, although a handful of policies may offer other options. The policy starts paying out once that period of time has elapsed, and will continue to pay until your benefit period is up.
  • Long-term disability. Long-term disability plans usually come with elimination periods of 30, 60, 90, 120, 180 or 365 days. The longer your elimination period, the cheaper your policy will be. This is because the range of illnesses and injuries that could put you out of commission — and work — for that long decreases over time.

Essential things to know about the elimination period

These are some of the key features of the elimination period:

  • If you recover before the elimination period ends, you won’t be eligible for a payout. With disability insurance, you only receive benefits if you’re still disabled after the elimination period has passed.
  • Elimination periods can accumulate. Let’s say your disability puts you out of work for a period of time. If you try to go back to work and realize you can’t, your insurer won’t restart the clock on your elimination period. It will just continue where you left off.
  • Some insurers will waive the elimination period if you file a second claim for the same disability. Provided you’ve only been working for a limited amount of time (say, no more than 6 or 12 months), you typically won’t need to wait out another elimination period. But if you suffer from a different disability, the elimination period applies.

Does the length of the elimination period affect premiums?

Yes. If you choose a shorter elimination period, you’ll pay more for coverage. And if you go with a longer one, you could save on your premium — but just know that you’ll need to pay for any living or medical expenses out of pocket during that time.

Which elimination period is right for me?

It depends how long you can support yourself without an income. Remember, the shorter the elimination period, the more you’ll pay in premiums.

The key is choosing an elimination period that aligns with the premium you can afford. To do the math, consider how much money you have in savings, and whether or not you’ll have new financial obligations in the future, like a mortgage or baby.

Let’s say you have enough savings to cover a year’s worth of living expenses. You could cut down your disability premium by choosing a longer elimination period, like 180 or 365 days. If your spouse is the breadwinner and could support you both, you could stretch out the elimination period longer.

But if you don’t have an emergency fund to fall back on, you might want a shorter waiting period.

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Bottom line

Choosing an elimination period is one of the key decisions you’ll make when buying a disability policy. Depending on the type of coverage you have, the elimination period ranges from 1 – 365 days, and the length you choose has a direct impact on your premiums.

Explore your options by comparing disability insurance companies.

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