Disability Benefit

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Definition - What does Disability Benefit mean?

A disability benefit refers to payments an insurance company makes to a disability insurance policyholder to provide a source of income while they are disabled. It is not the same as income from workers' compensation.

Insuranceopedia explains Disability Benefit

Disability insurance policies financially protect policyholders from the risk of becoming disabled. Whether it is a short-term, long-term, or permanent disability, these policies provide regular payments to the policyholder as a percentage of their original income or some other sum, depending on the policy. As disability often renders people unable to work or severely reduces their ability to work, disability insurance represents a way to continue receiving an income while disabled.


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