Disability

What is disability insurance?

The purpose of disability insurance is to replace the lost income from work should you become disabled, and unable to work. The disability insurance policy will stipulate when you are eligible to begin receiving benefits. Usually, you must be unable to work for a specified amount of time before disability benefits begin to be paid to you. The amount of the payments, the duration of coverage, and a description of exactly what constitutes a disability are contained in the policy. The premium for the policy is determined by a number of factors, including: the amount of the income payments, the length of payments, exactly what constitutes a disability, and such personal risk factors as the state of health and type of employment of the insured.

What are the odds of becoming disabled? What is the average duration of a disability?

The odds of becoming disabled depend on a number of factors, including age, health condition, and type of occupation. For many people, disability presents a much greater likelihood at their current age than does death. For example, at age 42 you are three times more likely to become disabled than die.

The chance of becoming disabled decreases somewhat with age, but the average duration of a disability tends to increase with age. Most disabilities last from a few weeks to a few months. At age 40, the average length of disabilities, lasting more than 90 days, is 5.5 years. At any age, however, there is a chance of becoming totally and permanently disabled.

Short Term Disability Insurance

This type of disability insurance plan provides an income for short term ranging form two weeks to two years. It covers the early part of your disability. Often it is included as part of an employee benefit plan. Again, short term disability insurance makes a form of income security during the waiting period before long term disability benefits starts. Moreover, this coverage is voluntary, means the premium can be wholly paid by the employee. Before choosing the right insurance policy for you, it’s very essential to check the definition of disability in the policy.

Long Term Disability Insurance

Disability insurance can provide financial security for disabled employees and their families during a difficult time. While some people have enough savings to withstand an income loss for a short period of time, most do not have the savings necessary to fund a long-term disability. The cost of medical bills, daily living expenses, and family emergencies can really add up—especially for disabled workers without disability coverage.

LTD provides monthly income to individuals who are unable to work or have reduced income due to an illness or injury.