Disability Insurance is one of those things that some people have heard of, but many don’t know what it is. Like many things, if we don’t know what something is, we tend to ignore it. By doing this though, we can miss out on the opportunity to educate ourselves about Disability Insurance and using it to our advantage.
What Is Disability Insurance & Why do I Need It?
Disability Insurance essentially is an insurance policy you purchase to protect yourself if you are ever in a situation where you can’t work. This may be due to an illness, injury, or accident. Life is very unpredictable, so anyone of these kinds of things can happen anytime. A sudden disease, a major car accident, or a work injury can strike without notice. The key is purchasing this type of insurance before you are unable to work, which makes this an investment in your future.
We tend to insure many things: cars, jewelry, houses, pets, even our life, why don’t we insure our ability to work and earn an income to provide for ourselves and family?
What Are Your 3 Options?
Group Disability Insurance Plans
- Offered through your work
- Cheapest type of coverage due to group rates
- Will pay 60-70% of your paycheck when you can’t work
- They dictate the terms. May have limitations and stipulations regarding mental illness and substance abuse,
- Most will not pay you more than 2 years worth of benefits. Your illness/injury may require more recovery or healing time than that.
Individual Disability Insurance Plans
- They will go by your individual needs and particular lifestyle, not a group rate.
- You can shop around for what you like and is convenient for you versus being stuck with what you get at work.
- You are able to dictate what you want in your policy and can add a variety of options.
- The sooner (age wise) you buy an individual plan, the cheaper it would be.
Supplemental Disability Insurance Plans
- A supplemental disability insurance plan is something you would purchase if you have a group plan at your work or you plan on relying on Social Security (not a great idea).
- This type of plan will “fill in the holes” of your current plan to further help you cover expenses when you can’t work.
The Bottom Line
Remember, when you are injured and/or ill and can’t work, you may feel vulnerable and stressed. That is not the time to find out that you are not covered. Do your research now and plan ahead. But with whichever plan you decide to go with, it is wise to consult with a Disability Insurance agent. They can answer your questions and fill you in on more details for the plan you are considering. They can help you narrow down what is in your best interest and also help you consider your lifestyle and budget.
Our advisors can help you get started. Fill out our quick Contact Form and we can contact you at your earliest convenience.