|
 |
Why You Need Disability InsuranceWhat is your most valuable asset? Your home? Your Car? Your Health? None of these are… it’s your ability to earn and income - Your Paycheck! Your income is what pays for both the big things in life – the mortgage, car, food, utilities, vacations – and life’s little things – children’s activities, movie tickets and cell phones. Most of us purchase insurance to protect our home, automobile, health, life, cellphones etc. but, choose to ignore the most important asset which needs to be protected– "YOUR INCOME". Without your income, you won't be able to afford any of your other basic needs.
If you were to become sick or hurt and unable to work, how would you continue paying for the place you call home? Or for the car your drive? Disability Insurance can protect your mortgage and car payments by providing you an income if you are sick or hurt and unable to work. The average cost of an individual disability policy is 1.5% to 3% of your income to protect about 55-65% of your income on a TAX-FREE basis. 
What Are Your options? Group Disability Coverage
If you have Group Disability coverage at work then you don’t own this policy. You may have Group Long Term Disability and, or Short Term Disability coverage at work. In some cases your employer pays part or all of these premiums but, most employees are not aware of the limitations of the group coverage. And, worse yet, how much of their paycheck is protected and, for how long. Your group disability coverage is not portable (meaning you can’t take it with you if you leave your job) and if your employer pays the premiums, your benefit becomes taxable. Individual Disability Coverage If you have Individual Disability Coverage, "You own this policy not your employer meaning this coverage goes with you after you leave your job". Benefits are not taxable (when premiums are paid with after-tax dollars) and can be purchased in addition to any group disability coverage you have. Disability policies provide a benefit if you are “unable to perform the duties of your occupation due to sickness or injury”. You have the option to purchase separately Short Term Disability (coverage usually for 6 months) or Long Term Disability (coverage from 2 years up to agese 65 or 67 if you occupation qualifies) You can also purchase a plan that covers both short term & long term disability. Policy definitions are different for each insurance company, so shop wisely or use an independent agency / broker who can provide you quotes to compare from several different companies. Each insurance company offers different features/riders which can be added to a policy. Some of the important riders to consider are “Own Occupation Rider”, “Residual Disability Rider”, “Inflation Rider (Cost of living)” “Return of Premium Rider if benefits are not used”. We can provide detailed information on how these riders work. How much do you spend on technology and dining out each month? Most Americans spend well over $250 per month but, those same individuals haven’t taken the important step of "Protecting Their Paycheck" and buying disability insurance because they perceive it to be “too expensive.” How long could you make ends meet if you no longer could afford your lifestyle because an unexpected illness or injury made it impossible to work? Spending around 2.5% of your income to protect about 60% of your income is a small price to pay. Contact us for more information about starting a "Paycheck Protection Plan" with disability insurance and, why it is so important to do. |
|