How Disability Income Insurance Can Help Protect You
We depend on our paychecks to cover our expenses: groceries, housing, transportation—and those are just the basics. When a person is unable to work due to a disabling injury or illness, the financial impact of lost paychecks can be devastating.
An income interruption due to a disability isn’t something you can afford to ignore. According to the Social Security Administration, more than one in four 20-year-olds will become disabled at some point before they retire. And 50 percent of working Americans would suffer financial issues in less than a month if they lost their paycheck. Twenty-five percent would have problems immediately—within a week—according to the Life and Health Insurance Foundation for Education (LIFE Foundation).
Here are some steps you can take right now:
Some terms to know when shopping for disability insurance:
The information in this article was obtained from various sources. While we believe it to be reliable and accurate, we do not warrant the accuracy or reliability of the information. The information is not intended to replace the advice of a qualified professional. Nor is it intended to effect coverage under any policy. State Farm makes no guarantees of results from use of this information. We assume no liability in connection with the information nor the suggestions made.
An income interruption due to a disability isn’t something you can afford to ignore. According to the Social Security Administration, more than one in four 20-year-olds will become disabled at some point before they retire. And 50 percent of working Americans would suffer financial issues in less than a month if they lost their paycheck. Twenty-five percent would have problems immediately—within a week—according to the Life and Health Insurance Foundation for Education (LIFE Foundation).
Here are some steps you can take right now:
Help protect your paycheck
When the unexpected happens, disability insurance can help. Disability insurance essentially replaces a portion of your income—generally about 40–60 percent—if you can’t work due to accident or sickness, says Matthew Tassey, CLU, ChFC, LUTCF and past chairman of the LIFE Foundation. “Disability insurance should be a priority,” he says. “We always have expenses.”Find the right fit
There’s no one-plan-fits-all approach to disability insurance. Some employers offer disability coverage, whether long-term or short-term, so check with your company’s benefits manager to see if you have coverage, and if so, what that coverage provides. If you don’t have it, you can purchase an individual plan.Some terms to know when shopping for disability insurance:
- Elimination period: Refers to the length of time you need to be disabled before you receive payment.
- Benefit period: Refers to the length of time benefits will last.
Learn more
In recognition of National Disability Income Insurance Month in May, the LIFE Foundation has created a website that explains the basics of disability insurance, contains video testimonials from real people and provides calculators for determining how much insurance you need and estimating your lifetime earnings. You can also calculate your personal disability quotient online.The information in this article was obtained from various sources. While we believe it to be reliable and accurate, we do not warrant the accuracy or reliability of the information. The information is not intended to replace the advice of a qualified professional. Nor is it intended to effect coverage under any policy. State Farm makes no guarantees of results from use of this information. We assume no liability in connection with the information nor the suggestions made.
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