It won’t happen to me. It’s easy to think that way when considering the possibility of being out of work due to a debilitating illness or injury. But the numbers paint a different picture. More than one in four of today’s 20-year-olds can expect to miss work due to a disability for 90 days or more before they reach 67, and 45 percent of consumers who filed for bankruptcy between 2013 and 2016 cited medically related work loss as a contributor.1
Back injuries, cancer, strokes, heart attacks, diabetes, and mental health issues are among the most common conditions that force people to take extended time away from work, but there are many more that unexpectedly afflict people every day. Worker’s compensation and Social Security do not cover many of these conditions. So, unless you plan to retire soon, or you can afford to go months without a paycheck, you should protect your income with disability insurance.
When selecting disability coverage, it’s important to understand the differences in policies. In general, there are two types of disability insurance: short-term and long-term. Both will replace a portion of your salary up to a cap. How much you pay for your coverage will vary depending on your age, health, occupation, how long it will pay benefits, gender (unlike life insurance, women typically pay higher rates for disability coverage), and the elimination period (the amount of time you must wait before collecting benefits).
When comparing coverage, be sure to know how the carriers define “disabled.” Some will only pay if you are unable to work at any job you’re qualified for. Others will pay if you can’t work in your occupation. Some will pay partial benefits if you can work part time, and others will only pay when you are unable to work at all.
Disability coverage often excludes certain health issues, such as existing back problems or mild depression, meaning you cannot file a claim if you’re disabled for an excluded condition. But because many injuries and illnesses can lead to a disability, you should still consider purchasing coverage even if you have an exclusion.
To learn more about how disability insurance can help protect your income and what coverage is right for you, call our office today to schedule an appointment.