Best Insurance Services
Mar 17, 2016
Chances are your income is one of the most important, necessary aspects in your life. In the event you are or become disabled, sustaining a normal, livable income can be incredibly difficult, especially when personal expenses increase as a result of your disability. Though disability insurance is one of the most important types of insurance out there, it is often misunderstood.
Let’s go over what disability insurance is, why it is important, and how you can benefit from a customized policy.
Disability insurance is a plan that provides policyholders with periodic payments and benefits to help counteract the loss of income and funds when the disabled insured isn’t able to work. Contrary to popular belief, disability insurance is designed to replace 45 to 65 percent of the disabled’s gross income, tax-free, in the event an illness or disability prevents the insured from working and earning a livable income.
There are two main types of disability insurance:
Short-term, which provides benefits from eight to 180 days.
Long-term, which picks up after the six months of short-term insurance has expired and lasts until the insured reaches 65 years of age.
Another common misconception with disability insurance is that employers always provide policies for their employees. This idea, and the fact that many people never plan on becoming disabled, prevent many individuals from seeking private, reliable disability insurance policies. Though consumers are not required by law to purchase disability coverage, having a dependable, quality plan can act as a valuable safety net in the event of an accident or illness.
The Council of Disability Awareness recently released a report claiming that approximately one-in-four of 20-year-old Americans will become disabled before they retire. Whether the disability is back injuries, cancer, heart disease, or another type of illness, these issues typically result in long-term absences that prevent individuals from working for the rest of their lives, thus also preventing them from earning a sustainable income.
No matter if the individual is a salesperson who experiences a stroke and is no longer able to speak, an athletic trainer with debilitating back pain, or an accountant with unmanageable migraines, having an insurance policy that can provide them with benefits as a partial replacement for their income is absolutely vital.
In order to receive benefits under a disability insurance policy, an individual must adequately meet the definition of disabled as defined in the insurance policy. In general, most disability insurance policies provide benefits for both total and partial disabilities.
Total disability is typically defined in two separate stages. At the beginning of the disability, the insured is considered totally disabled if they cannot perform basic duties outlined in their occupation. Stage two begins after two years of living with a disability that prevents the insured from performing any type of job as it pertains to the individual’s education, training and experience.
A partial disability prevents the insured from performing one or more essential tasks required in the individual’s occupation, or if the disability reduces the percentage of time or hours required to sustain employment.
Even though many employers offer some form of disability insurance, purchasing a reliable, individual policy from a dependable insurance agency is the best way to have peace of mind when it comes to preventing financial hardship in the event of an existing or potential disability.
At Best Insurance Services, we work with the top insurance providers in California to find you the right disability insurance policy. Contact our agents today to get your policy started.
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