If you were to become disabled and couldn’t work for a period of time, would you be able to pay your bills? Would you and your loved ones be able to stay in the family home? If you are like most people, you don’t even want to think about this possibility. However, 56 million Americans live with disabilities. The unfortunate reality is that many Americans simply don’t have adequate savings to protect themselves. Qualifying for Social Security Disability benefits is difficult at best, and it could take years before your application is ultimately approved, after multiple denials and appeals. That’s where individual disability income insurance comes into play.
When you have the foresight to buy disability insurance, you’re giving yourself – and your loved ones – a gift you hope will never need to be opened. If disability strikes, your insurance policy will pay you a monthly cash benefit that you can use to continue paying your mortgage or rent, car payment, utility bills, medical bills, and meet your other financial obligations.
There are different types of policies. A short-term disability policy is designed to protect you if your condition means you can’t work for a temporary period of time, usually only up to three or six months. Some people have this type of insurance coverage through their employers. Long-term disability income insurance policies generally protect people when their disabilities last for a longer period of time, such as two years, five years, ten years, or even until retirement in some cases. Because you never know if, when, or how severe a disability will be, relying on an employer-sponsored short-term disability policy is risky.
Neither short-term nor long-term policies are designed to protect 100 percent of your income, but they can replace a significant part of it so you don’t have to completely deplete your savings if a disability strikes.