Disability insurance is a type of insurance that protects you should you become unable to earn an income as a result of an injury or illness. Every person knows they must work in order to earn money to pay for housing, car food, and other living expenses. However, if a person becomes injured or develops an illness so severe they are unable to continue working at their job or any job, how can they provide for themselves or their family? Disability insurance coverage allows for a partial monthly income (benefit) to be paid to a person who finds themselves in such a situation. This assurance of a monthly benefit can provide peace of mind to those with disability insurance who suddenly find themselves unable to earn an income.
Disability insurance is generally for those working in hazardous conditions, right? Wrong. Disability insurance is for anyone working in any profession. After all, the potential to become ill or injured, regardless of the type of work a person is engaged in, is a risk that continues as long as life does.
Consider these points:
– We consider the possession of health, home-owner’s, and automobile insurance all critical steps of personal protection. What about the protection of one of our most valuable assets-our income?
– Life insurance allows peace of mind to those who own it by offering them the knowledge that their families will be cared for when they die. Disability insurance offers peace of mind to those who own it while they’re living, and, if they have a family, the knowledge that they will be cared for as well;
– The likelihood of developing a disability is greatest during your working years;
– The majority of people grossly underestimate their chances of developing a disability or illness.
With these points in mind, it makes sense to consider the acquisition of disability insurance. Frequently, disability is offered through a person’s place of employment, or through a union or professional group. Major insurance providers also offer disability insurance for those seeking to purchase it individually. There are two types of disability insurance a person can choose to obtain:
1. Short-Term Disability
This type of disability is frequently provided by an employer. When an individual becomes injured or ill and is covered by short-term disability, they receive an income during the early period of their injury. Depending on the insurance provider, the individual may receive disability benefits for 2 weeks or up to 2 years.
2. Long-Term Disability
Long-term disability may be offered by an employer or purchased separately by an individual. This type of disability replaces income during an extended period of time, normally for 2 years, 5 years, or until the disabled recipient turns 65. There are two types of long-term insurance available to individual consumers:
– Non-cancelable long-term disability: Under this type of long-term disability coverage, the recipient has the assurance that their premium (monthly cost of insurance), will never be raised, and, that their policy (the insurance contract) cannot be cancelled as long as it is being paid on time;
– Guaranteed renewable long-term disability:This type of policy, usually less expensive initially, allows the premium to be raised, but only if it affects a class of policy-holders.
You may think that because you are very healthy now or that the type of job you have involves very little or no hazards, disability insurance is not necessary. Before you completely decide that you do not need disability insurance, read through these examples of disability insurance claims:
ProfessionAgeDisability/Illness
Accountant58Pancreatic cancer
Attorney40Pregnancy
Dentist 50Fractured clavicle
Executive42Psychotic conditions
Physician obstetrics62Lower back pain/strain
Physician56Leukemia
Sales 33Traumatic brain injury
As you can see, the profession of a person receiving disability benefits and the cause can vary widely. Pregnancy is considered a disability because it frequently makes a woman unable to work, whereas a dentist’s fractured clavicle caused him or her to be unable to perform their job. Disability insurance benefits can benefit a person regardless of whether their injury was caused in association with their job or not. Disability insurance can provide partial monthly income to injured policy-holders unable to work for as little as a 2 week period to a period that extends to their retirement.
Whether disability insurance is being offered to you through your place of employment, or if you are deciding whether to purchase a disability policy individually, take the time to study your offerings. Disability policies and premiums vary widely, as do definitions of disabilities and periods a person must wait before receiving their disability benefits. Take the time to compare disability insurance plans and providers in order to find the policy that best meets your needs.