Disability Insurance
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Disability is also called Income Protection. Is your income protected? |
According to the Social Security Administration, 1 in 4 20 years olds today will become disabled before they reach retirement age, which could put them out of work and depending on social security benefits to live. In 2019, the average benefit amount was $1,234 which according to the site is barely enough to keep them above the poverty level. An accident can happen at any time to anyone. So do your best to protect yourself and your family against the unknowns in life. A disability plan is designed to cover a portion of your income if something happens and you are unable to work. Plus as you get older the risk of becoming disabled increases and the healing time increase. Some do not fully recover.
According to the CDC, 61 million adults live with a disability in the US. Most Americans do not have enough savings to provide the basic necessities if a disability would occur. So the question is.....how would you support your family with food, shelter, clothing, and utilities if you were to become disabled and lose your income?
According to the CDC, 61 million adults live with a disability in the US. Most Americans do not have enough savings to provide the basic necessities if a disability would occur. So the question is.....how would you support your family with food, shelter, clothing, and utilities if you were to become disabled and lose your income?
Short Term Disability Insurance
STD (short term disability) benefits come with short elimination periods and short benefit duration periods. They are intended to bridge the gap between the time of the employee’s disability and the beginning of long-term benefits starting.
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Long Term Disability Insurance
Many companies offer LTD (long term disability) benefits that pick up when STD benefits end. Elimination periods usually correspond to the benefit periods of the company’s STD policy. For example, if a short term policy had a benefit period of 6 or 12 months, then a LTD policy could have a 6 or 12-month elimination period (equal to the benefit period for its STD policy). LTD benefits can be offered for periods as short as two years to five years, or as long as the individual’s lifetime. More typically, they are offered up to around age 65, at which time the person’s retirement plan takes over to provide an income stream for the rest of the individual’s life. Retirement income, like disability income, is intended to replace an individual’s working income. To pay both retirement and disability income would be a duplication. Most group disability plans use a disability benefit level of 60 percent to 70 percent of gross salary. To reduce the employer’s cost, benefits may be reduced by any amount a disabled employee receives from Social Security or workers’ compensation.
