Assurance Financial Solutions (205) 578-2097
Just over 25% of today’s 20 year olds will become disabled before they retire. There are over 37 million Americans currently disabled and unable to work. Disability happens far more often than most of us imagine. If you became disabled how would you replace your income? Don’t wait until disaster strikes. Call or email me now to get started.
If there is a neglected form of insurance in business or family planning, it’s disability insurance. The reality is that statistically, you’re far more likely to need your disability insurance. What is disability insurance? Think of it like this; if your life insurance is built to replace your lost income in the event of your death, your disability insurance will replace your income in the event that you become disabled or no longer can work for a living. What can be more important to our businesses or our families than our ability to work and earn income?
Likelihood of Needing Disability Insurance
If you’re like most people, we make our decisions on whether or not to purchase a certain insurance product based on the likelihood of needing the coverage. So here’s the question; how likely are you to need disability insurance? Let me answer this question in a different manner. How likely are you to need our auto insurance? All 50 states now require car owners to own auto insurance. We’re not required to always have comprehensive coverage rather than just general liability on our autos but more than 80-85% of the population pay more for comprehensive coverage. Why is that? I think the answer is that we know that there is an excellent likelihood that we will one day have a claim. According to my favorite local State Farm guy, statistically, every auto owner will have a claim every 18 years. So we make the decision to pay more due to the increased risk of loss. So how likely are you to need your disability coverage? According to a recent study done by the Social Security Administration, just over 1 in 4 of today’s 20 somethings will be disabled before reaching age 67. That bares repeating; 1 out of every 4 persons will become disabled at some point in their lifetime! Sounds risky doesn’t it? What would be the affect on a business or family if you couldn’t earn a living for a number of years? It would be devastating!
What Types of Disability Options are Available?
GROUP DISABILITY PLANS
The most common form of disability coverage is through employer provided benefits. An employee can voluntarily have coverage through some form of salary deduction. Group disability is generally very affordable. But here’s the problem, most group disability options are very limited in what they cover. Most group plans place a limit on the monthly or annual benefit that can be paid out to you. Having some coverage is always better than nothing. But it’s important for you to read the policy and know what you’re paying for! Read the details on your coverage and what portion of your salary is protected(usually 60%).
SHORT-TERM DISABILITY INSURANCE
Short-Term Disability (STD) pays you a portion of your income for a short period of time after you run out of sick leave. Depending on your plan, STD generally will pay you for between 9 and 52 weeks (or 1 year).
LONG-TERM DISABILITY INSURANCE
Long-term disability insurance (LTD) is an insurance policy that protects an employee from loss of income in the event that he or she is unable to work due to illness, injury, or accident for a long period of time. Policies can be designed to pay out a monthly benefit anywhere from one year or until retirement age when social security is accepted.
Owning Your Own Policy
If your employer doesn’t offer protection or if you don’t like the details of the policy, it will make more sense to go to the open market and shop for your own policy. Owning your own policy is generally more affordable than your salary deducted disability insurance. Why? Your company option is built to insure a wide swath of employees with various ages and duties. Think of it as a one size fits all premium for all employees. So more often than not, the average person can be underwritten with less risk. Less risk usually equals less premium.
One thing to remember and that I make it a point to mention in conversation with business owners or employees, you want to be the one to determine outcomes! If your disability or your life insurance for that matter, is provided by your employer, you do not have control over the specifics of the policy. If you were to lose your job or accept another position with a company that does not offer disability coverage, your insurance is generally lost as well. Own your coverages!
Doesn’t Social Security Cover Disability?
The answer to that is yes, SS can pay some income if you’re disabled and can not work. But the amount paid to a disabled person is not an “adequate” replacement of income. In 2013, according to SSA, the average monthly benefit was $1,130 per month. For most families and businesses that just simply isn’t enough. To make matters more complicated, qualifying for a Social Security benefit is very complex. Everyone knows of “that” person in their family who tried for years to get on social security and was repeatedly denied. There are even lawyers who specialize in working with people who were turned down! Again, you want to be the one to determine the outcomes! The best way to do this is to own it if possible.
CALL ME AT (205) 578-2097 TO CHAT ABOUT YOUR NEED OR FILL OUT OUR ONLINE QUOTE FORM TO GET INSURANCE RATES FAST.