If you’re like most Americans, you probably have many different types of insurance policies. There’s homeowners insurance and renters insurance. Then there’s life insurance, and the most common ones you likely have: health insurance and car insurance.
What about disability insurance? How would you protect your family and your financial stability if you were physically unable to work? If you don’t know the answer to that question, you may want to consider additional short-term or long-term disability coverage.
Unfortunately, many Americans don’t have enough disability coverage to fully protect themselves. They may believe they won’t become disabled. Or, they may think they have protection from other sources.
There are a number of common myths about disability and various types of coverage. When deciding whether or not disability insurance is right for you, it’s important you know the difference between myth and fact. Below are three common disability myths. Don’t fall for these myths as you consider disability coverage.
1. I won’t get disabled.
You may be resisting disability insurance because you believe it won’t happen to you. However, the odds suggest a disability may be a very real possibility. A study from The Council of Disability Awareness in 2013 found one in four 20 year olds would become disabled at some point during their lifetime. The same research found the odds of disability are even higher for someone who smokes or is overweight.1
If you think those odds are high, consider the fact that disability can come in many forms. You may think of disability as something that comes as the result of an accident. That’s not always the case. Disability can be any physical condition that prevents you from performing your job. That could include things like heart disease, cancer or even arthritis. For many people, disability is a very real possibility.
2. I can get Social Security disability benefits.
It is possible you may qualify for Social Security disability benefits should you become disabled. However, there are a few reasons why you may not want to depend on this as your sole source of protection.
First, Social Security disability applications are notorious for having a slow approval process. It could take months or even years. Also, there’s no guarantee you’ll be approved. If it isn’t, you may not receive any benefits or you may have to go through a lengthy appeals process.
Finally, even if you do get benefits, it likely won’t cover all your needs. There are caps on the amount of benefits you will receive, and you may find it’s insufficient to cover your medical costs and your living expenses.
3. I will be covered by my group policy.
Many employers offer long-term disability coverage as part of their group benefits. If you’re covered under a group policy, then you at least have some level of protection. However, it’s possible you may still want additional coverage.
Many group policies have long termination periods. This is an amount of time you must wait after your disability occurs and before your benefits kick in. Your termination period could be six months or more. Consider whether you can afford to support yourself with no income while you are waiting for your group policy to kick in.
Also, some group policies cover something called “any occupation” disabilities. This means they will only pay benefits if you are so disabled you are not able to perform any occupation. That’s a high standard, and it could be a problem, especially if you’re in a high-paying, skilled position.
You likely want coverage that covers your “own occupation.” That kind of coverage will pay benefits if you can’t perform in your own position, but you are able to perform other, lower-paying jobs.
Your ability to earn income may be your most important asset. If you would like to explore ways to protect that asset, contact us at J. Harris Financial. We welcome the opportunity to examine your needs and recommend the best strategies for your goals and your budget.
This information is designed to provide a general overview with regard to the subject matter covered and is not state specific. The authors, publisher and host are not providing legal, accounting or specific advice for your situation. By providing your information, you give consent to be contacted about the possible sale of an insurance or annuity product. This information has been provided by a Licensed Insurance Professional and does not necessarily represent the views of the presenting insurance professional. The statements and opinions expressed are those of the author and are subject to change at any time. All information is believed to be from reliable sources; however, presenting insurance professional makes no representation as to its completeness or accuracy. This material has been prepared for informational and educational purposes only. It is not intended to provide, and should not be relied upon for, accounting, legal, tax or investment advice.
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