WEDNESDAY, AUGUST 9, 2017
 In the business world employees generally get paid when they work, when they take vacation or sick time, or when they have disability insurance coverage and a qualifying disability. If you want to secure disability insurance to ensure that your family still has an income to rely on should you become disabled, then you first need to get a handle on the many disability insurance choices out there so you can create a policy with options that suit you and the needs of your family.
Percentage of monthly income: Disability insurance policies generally pay out a percentage of your pre-disability income. Look at your family’s income needs and budget in order to get a good idea of how low a percentage you can survive on. The lower the percentage of your income they pay, the lower your premiums will be.
Definition of Disability: In some policies, the definition of disability is very specific and meets that of the Social Security Administration, which means you won’t have access to benefits unless you are totally disabled and unable to do the work of your career OR any other. Other policies offer broader definitions that allow more situations to meet the requirements including partial disabilities.
Waiting period: Disability policies have varying options for the waiting time between the date your disability occurs and the date you can begin receiving payments. If you have sufficient savings, you may opt for a longer waiting period. If your family has few resources to help replace lost income, then a shorter waiting period could be a better, albeit more expensive, option.
Benefit term: Disability insurance can have a benefit term that is short—six month to a few years—or can stretch all the way to retirement. The longer your benefit term, the more protection you have and the higher your premiums are likely to be.
Inflation protection: What $10 buys today, $10 might not buy next year. Inflation is a very real concern among those with a long-term disability because they can’t expect to get cost of living increases like a working employee. That is why some disability policies come with inflation protection benefits that increase disability income by a certain percentage each year.
No one can predict whether a disability is in their future. When you have a disability insurance policy structured to complement your family’s financial situation and needs, you don’t have to have a crystal ball because you can be confident that your way of life is protected, no matter what.
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