Bad Faith

Generally speaking, an insurer commits bad faith when it acts unreasonably and fails to treat the insured fairly. Each state has different requirements for bringing and establishing a bad faith claim. Depending on state law, the insurer may also have to establish that the insurance company acted knowingly or with reckless disregard as to the reasonableness of its actions. Some states also permit awards of punitive damages in insurance bad faith cases.


The person or entity entitled to receive proceeds or benefits under the policy.

Benefit Offset

Many disability insurance policies contain offset provisions that reduce the amount of your monthly benefit if you receive income from other sources, such as Social Security disability or retirement, unemployment compensation, worker’s compensation, no-fault auto insurance, sick leave, severance pay, income from a new job, etc. The amount of the offset depends on the terms of the policy and the particular formula(s) used to calculate the offset.

Click here for more information about how offset provisions can reduce your monthly benefits.

Benefit Period

The maximum amount of time the insured may receive proceeds for a continuous disability.  Usually benefits last until around age 65 or 67, but some policies provide for lifetime benefits.

Click here for more information about different types of benefit periods.

Business Overhead Expense Policy

This type of insurance policy covers business-related expenses (such as rent, utilities, employees’ salaries, etc.) if you become disabled and cannot work, but typically only for a short period of time—usually no more than two years.

Click here for more information about business overhead expense policies.