How Disability Insurance Can Help You

Many Americans consider themselves “insurance poor” and for good reason. We are required to carry auto insurance if we own a car, homeowner insurance if we own a home, and now health insurance just for existing. With all the insurance we are required to carry, it is small wonder that many people overlook disability insurance.

In the industry, May is designated as Disability Insurance Awareness Month. This is the time to educate consumers on the benefits of this type of insurance and how it can help you through a difficult time in your life. No one ever plans to get sick or injured during their working years but if it happens to you, you will be thankful to have a safety net to help pay your bills and feed your family until you are able to return to work.

What is Disability Insurance? Disability insurance is coverage offered to an individual to pay for a portion of their lost wages should they become ill or injured and unable to work. Policy coverage varies but typically, you will receive up to 65% of your gross income during your illness or injury. Before the benefits kick in, however, there is a waiting period depending on the specifics of the policy. There are two general categories of disability insurance: short-term, and long-term.

Short-Term Disability: Short-term disability insurance pays a percentage of your salary should you become temporarily disabled. The waiting period for coverage to begin can be as short as a few days and the benefits are typically paid out for up to six months. Short-term disability policies are often used in conjunction with long-term disability insurance to provide comprehensive coverage without an extended waiting period for benefits.

Long-Term Disability: Long-term disability insurance essentially picks up where a short-term policy leaves off. The typical waiting period for benefits to pay out is 90 days and coverage may continue for as long as 10 years (depending again on the policy) or until the individual is able to return to work. Long-term disability is the ideal solution for catastrophic incidents that put an individual out of work for an indefinite period.

Disability insurance can often be obtained through an employer, but the coverage offered at work may not be sufficient to meet your needs in the event of an illness or injury. A Maryland independent insurance agent can examine your needs and the options you have available at work to determine if it might make sense to purchase a supplemental policy. Independent agents typically have access to several of the top area insurers, giving them the ability to help you find the exact coverage to meet your family’s needs.