While no one ever expects for an accident to occur at the workplace, the possibility of such an event is very real and could result in a disability. Not only could the disability hinder either the mental or physical state of the worker, but it could also affect income. It is in such situations that disability insurance becomes a necessity. If you become disabled, disability insurance can serve as a fractional income that has the power to help you with day to day living costs. Many people feel they will be sufficiently covered with just life and
health insurance, but that isn't always the case.
The Fundamentals of Disability InsuranceA person becomes qualified for disability insurance when they are unable to work due to a sickness or accident. An individual with disability insurance will receive an explicit percentage of income, but in order to receive the payments, the individual must also have a definite time frame they are unable to work.
The insured person will obtain one of two different types of disability insurance: short and long term. Short term disability insurance, which caters to transitory disabilities, has a payable percentage between 50 and 65 percent and a two week waiting period. The assistance provided by this kind of disability insurance can last for up to two years. In contrast, the benefits of long term disability insurance can stretch the time span of only a few years to the remainder of your living years. Unlike the short term waiting period, the long term delay period could be several months.
Disability insurance policies dictate what accidents and sicknesses are policy covered and provide details of payment amount, the length the payments will be distributed, and an explanation of the disability. Because there are many particulars involved in a disability insurance policy, knowing the features of your policy is essential.
Important Disability Insurance FeaturesSome of the features that should be looked closely at are: how an insurance company defines disability, taxable earnings replacement, and the specifics of the benefits coverage. The definition of disability varies depending on the insurance company. With some companies, assistance will be provided if the individual is unable to perform the tasks of their former occupation. But with others, benefits are only available for those no longer able to complete any job compatible with their previous work experience or educational background. The taxable earnings replacement percentage should substitute anywhere from 60 to 70 percent of your entire income. It is also important to check the total amount of time the disability insurance benefit payments will last. Probably one of the most important steps to take before becoming insured with a company is to verify its background. This can be done either through the insurance company itself or online ratings systems such as
secure insurance quotes.
Statistics for Disability InsuranceMany people may not see disability insurance as a necessity, but statistics show it is a must. The
Social Security Administration reports that though three out of ten of all workers in the United States will become disabled before they retire, only 30 percent actually have long term insurance. According to disability insurance statistics, there are currently over 51 million Americans who are regarded as disabled. Though the chances of becoming disabled before you retire may seem small, statistics for a shorter period of time say otherwise. The probability of a worker becoming disabled for at least six months is one in three, which is why obtaining disability insurance is a crucial preventative measure to protect both you and your family.
There is also another form of precautionary disability insurance for mortgages. If you become disabled, mortgage disability insurance payments will go towards your mortgage, and has the ability to do so for up to three years. The Department of Housing reports an alarming statistic: nearly 40 percent of foreclosures on homes are caused by disabilities.
Disability insurance is a great way to guard yourself against accidents in the workplace. The features of the policy should be thoroughly investigated to ensure you are choosing the disability insurance that suits you best.