Disability insurance is an often-overlooked part of the overall package of insurance you need to protect your loved ones and your standard of living. What does it do? In short, it pays you a portion of your income if you get sick or hurt and can’t work. There are long-term and short-term plans, so you’re covered no matter how long your disability lasts. But now that you know what disability insurance does, there’s still the question: “Do I need disability insurance?”
➡️ Already know you need disability insurance? Click the button below to request a free quote.
Request a Free QuoteHow to Answer the Question, “Do I Need Disability Insurance?”
There’s one easy way to answer this question.
Ask yourself: “Do other people depend on my income?” If the answer is yes, you need disability insurance. It’s as simple as that.
We tell our clients that your most valuable asset isn’t your home or your retirement account. It’s your ability to earn a paycheck – because that’s what keeps money flowing into your household to pay for housing, food, transportation, utilities, clothing, school, and all the other necessities that keep your family moving. Disability insurance protects you against the “what if’s” in life.
The odds of becoming disabled may shock you, too. In 2022, the U.S. Social Security Administration estimated that 25% of 20-year-olds will be out of work for at least a year because of a disability by the time they retire.*
Some employers offer disability policies to their employees. Usually, these are short-term rather than long-term policies. Check with your HR representative to see if you already have coverage and if so, which type. Take a close look at the benefit amounts offered, too. In many cases, these are token amounts that cap benefits at a few thousand dollars – likely not enough to support an entire family if anything actually happened to you.
➡️ “Do I need disability insurance?” We hope we’ve convinced you the answer is yes! Want to see how affordable it is to buy your own disability insurance policy? Click the button below to request a free quote.
Request a Free QuoteWon’t I Get Government Benefits if I’m Disabled?
Maybe – but not in every case.
Government disability benefits (SSDI and SSI) have very strict requirements, including the length of your disability. If you’re not going to be disabled for at least a year, for example, you’re not eligible. Plus, the majority of applicants are rejected the first time they apply. In fact, from 2010 through 2019, only 31% of claims filed were awarded benefits.** Applications got denied for both medical reasons (the applicant was determined not to have a qualifying disability) or technical details (the application wasn’t filled out or didn’t include required supporting documentation).
Let’s say you have an injury that’s going to keep you out of work for ten months. That’s not long enough to apply for government benefits. But on the other hand, it’s still a significant loss of income. Do you have ten months’ worth of income saved up? How are you going to pay bills during that length of time? If you had a private disability policy, you’d know how to answer that question.
➡️ Want to see how affordable it is to buy your own disability insurance policy? Click the button below to request a free quote.
Request a Free QuoteWhat about Worker’s Comp?
Worker’s Comp pays out to people who get sick or hurt while doing their job. It’s a type of insurance employers have to pay for, not employees. It’s intended to compensate for medical expenses as well as lost wages for employees who can’t work. To qualify, you have to get sick or hurt at work while doing your job – and the illness has to be caused specifically by your job duties, not just by proximity to another sick employee, for example.
But it may surprise you to learn that most long-term absences from work are due to illnesses, not injuries. Worker’s Comp won’t cover you if you get sick off the job. The Council for Disability Awareness notes that most long-term disability absences happen due to things like back injuries, cancer, and heart disease.*** None of these conditions qualify you for Worker’s Comp.
Similarly, Worker’s Comp won’t cover you if you hurt yourself off the clock. Driving home from work and get in a car accident? Not covered. Installing crown molding in your home and fall off a ladder? Not covered. You’ve probably heard the old saying that most accidents happen in the home. That’s because it’s true – the National Safety Council notes that 53.6% of all injury-causing accidents happen at home. Another 27.5% of injury-causing accidents happen in public places like parks, playgrounds, and pools.^ If there’s an accident in your future, there’s a good chance it’s not happening at work – which rules out your eligibility for Workers’ Comp. Be careful out there!
➡️ Want to see how affordable it is to buy your own disability insurance policy? Click the button below to request a free quote.
Request a Free QuoteWhat Do I Get with Disability Insurance?
When you have your own disability policy, you can protect 40% - 70% of your income (about what you take home after tax). The amount you get will depend on the insurer’s maximum amount allowed. You can also choose the percentage of replacement you want – replacing more income costs more. This means you can customize your policy so you get a comfortable amount of replacement income at a monthly payment that fits your budget.
Like life insurance, your age and health factor into how much your policy will cost. That’s why it’s a good idea to act now – none of us are getting any younger. Plus, you want to have coverage in place before you develop any health problems that could lead to a long-term disability. Owning your own policy also means it’s not dependent on a particular employer. You can change jobs without losing coverage!
According to the Social Security Agency, a whopping 65% of people who work in the private sector have zero long-term disability coverage.^^ Yikes! That’s a lot of risk out there…and a lot of families that need protecting. Is yours one of them?
We think there’s only one way to answer the question, “Do I need disability insurance?” And that’s with a resounding “Yes!” But it’s also natural to have a lot of questions – and we’re here for you. Check out our tips for buying disability insurance here. If you’d rather talk to a real person about disability insurance, give us a call at 800-823-4852.
➡️ Want to see how affordable it is to buy your own disability insurance policy? Click the button below to request a free quote.
Request a Free Quote*”Disability and Death Probability Tables for Insured Workers Who Attain Age 20 in 2022,” SSA.gov, accessed 6/8/23
**Outcomes of Applications for Disability Benefits, SSA.gov, accessed 6/8/23
***Overview, disabilitycanhappen.org, accessed 6/8/23
^Overview, injuryfacts.nsc.org, accessed 6/8/23
^^Social Security Fact Sheet, SSA.gov/news, accessed 6/8/23