What's the difference between casualty insurance and disability insurance?

By Barry Higgins AAA
A:

Casualty insurance is often called "property casualty insurance", and it provides insurance protection for your property in the event of a covered loss. Property that is commonly covered with casualty insurance includes houses, condominiums, cars, motorcycles, boats, yachts and personal sports and recreation machines.

In the event of a loss resulting from a covered event named in the policy, casualty insurance is designed to repair or replace the property for the policyholder. Covered events may be auto accidents, acts of God (such as damage resulting from weather), vandalism and theft. These covered events are detailed in the policy and should be reviewed and understood when buying a casualty insurance policy. (Be sure to read Insurance Tips For Homeowners to learn more about the insurance policies available to protect your home.)

Disability insurance protects an individual's income in the event the insured becomes too ill to work, or is hurt and unable to earn an income. In the event of a disability, a portion of an individual's income is replaced through the benefits of the disability income policy. This helps reduce the financial impact a disability may have. (Learn how to translate this complicated type of insurance policy, in our related article The Disability Insurance Policy: Now In English.)

Companies offering disability insurance often limit the amount of coverage available to an individual - usually based on the individual's income. A disability income policy is designed to help reduce the financial impact of a disability, not to fully replace an individual's income.

This question was answered by Barry Higgins.

RELATED FAQS

  1. Who are the best-rated life insurance companies in the US?

    Learn about what makes an insurance company the best. Read about the best life insurance companies in the U.S. in 2014, following ...
  2. What are some examples of when insurance bundling is a bad idea?

    Learn about situations where insurance bundling may not be a favorable option. Bundling insurance is often a good idea, but ...
  3. What are the tax implications of a life insurance policy loan?

    Learn the instances in which you are required to pay taxes on a life insurance policy loan, so you can avoid making a costly ...
  4. What is a collateral assignment of life insurance?

    Learn about collateral assignment of life insurance so you can make a wise decision about what kind of collateral to use ...
RELATED TERMS
  1. Medical Identity Theft

    Stealing another person’s health insurance information so that ...
  2. Noncancellable Insurance Policy

    A life or disability insurance policy that an insurance company ...
  3. Member Month

    The number of individuals participating in an insurance plan ...
  4. Pre-Existing Condition Exclusion Period

    A health insurance benefit provision that places limits on benefits ...
  5. Policy Or Sales Illustration

    An educational tool that shows a prospective or new insurance ...
  6. Point-of-Service Plan (POS)

    A type of managed-care health insurance plan that provides different ...

You May Also Like

Related Articles
  1. Thanks to the Affordable Care Act, you can no longer be denied health insurance for having a pre-existing or chronic medical condition.
    Insurance

    Choosing A Health Plan For Your Chronic ...

  2. Four key factors to check out before you just sign up for dental insurance. The coverage could be really worth it – or not.
    Insurance

    Does That Dental Insurance Have Cavities?

  3. Compared to other options, does it ever make sense to include cash-value life insurance in your investment portfolio?
    Trading Strategies

    How Good An Investment Is Life Insurance?

  4. Insurance

    4 Steps to Finding the Right Health ...

  5. Insurance

    Tips for Finding Affordable Health Insurance

Trading Center