Not everyone understands the importance of disability insurance. They don’t understand that disability insurance isn’t the same as their health care insurance. While it’s hard to prepare for the future, not imagining the possibility of a disabling injury or illness happening is unrealistic. Injuries and illnesses can happen unexpectedly and without proper planning and honest foresight, those illnesses and injuries can lead to devastating financial repercussions.
Disability insurance is an insurance policy that can be taken through an employer or independently. These policies will replace a portion of the policyholder’s income in the event they become injured or disabled and aren’t able to work for a specific period of time or indefinitely. These policies can replace a maximum of 80-95% of lost income and a minimum of 50%. While it’s not 100% replacement, when facing a period of time with no income, some is better than none.
Why Isn’t This a No-Brainer?
Millions of people choose not to get disability insurance from their job because they don’t fully understand the benefits of these policies. Most people don’t talk about the benefits of disability insurance. While it’s an important thing to think of, it’s one of those things that are overlooked because many people don’t think they will fall victim to a sudden illness or injury.
One of the biggest reasons that people don’t automatically sign up for a disability insurance policy is because they don’t think it will happen to them. Millions of people don’t think they will become ill and disabled because they are enjoying good health now. Many don’t think they could be involved in an accident that will leave them disabled. The phrase ‘it won’t happen to me’ has led many people down a path of financial hardship.
What is Disability Insurance?
Disability insurance is very simple to understand. Disability insurance will replace a portion of the policyholder’s income in the event that they become disabled due to illness or injury. Many of these policies will allow a person to file a claim if they are not able to perform the job they were trained to perform.
What qualifies as a disability varies. There are some people that have successfully filed a disability insurance claim because of vertigo or obesity. There are others that have filed claims based on injuries such as a broken leg, back or blindness due to an accident. There are many things that can be defined as a disability. No matter what the illness or injury is, if it interferes with someone’s ability to work, it can be a reason to file a disability claim.
The Reality of Living Without It
When an illness or injury happens, most people are not able to work. They aren’t able to work their normal job nor are they able to perform any other job. Without an income, most people will not be able to pay their bills or maintain their lifestyles. When this happens, most become dependent upon others or lose everything they have worked hard for. Without an income, most people find it very hard to live in this modern world.
By having disability insurance, a portion of income will be replaced. These payments may come weekly, bi-weekly or monthly. While it’s not 100% income replacement, it’s still an income until the policy holder is able to return to work.