Disability Insurance

Today we are going to look at disability insurance.

Let’s say you work for an employer, and they don’t offer disability, or you’re self-employed, and you don’t have access to disability insurance. I have a solution.

There is a great company that can assist with disability insurance, called, Assurity.

They issue disability for people who:

  • don’t have access to it through an employer
  • want to get it on their own.

Bear in mind, that it’s not really a maternity product, meaning you can’t just buy disability insurance because you’re going to be out on maternity leave. The purpose of this product is to protect your income. Disability insurance truly is meant to keep you afloat until you can get back to work.

There are different options.

You can select:

  • a larger elimination period (which means before the benefits start paying)
  • a smaller elimination period

NOTE: Usually with disability insurance, you have to be without your income. Depending on your industry, the company will determine if you’re unable to work, will you still get paid, etc. For example. If I were disabled, I would get some pay because I do get residuals, because I’m an insurance agent. But I wouldn’t be able to write new business.

If your company is not going to run without you, then disability may be very important to consider. We would need to evaluate how long of an elimination period you would need.

  • How long can you go without a paycheck?
  • No one ever wants to go without a paycheck. But obviously, the shorter the elimination period, the more money that the insurance costs.

It is also good to note that social security disability kicks in once you’ve been disabled for a year. There are exceptions to that, depending on if you’re diagnosed with something that gives you immediate disability status. But, generally, I advise my clients to look at disability cover that would help them for the first 12 months until social security kicks in.

There are honestly not a whole lot of long-term disability products that I would spend money on. Social security is going to be based on your earnings for the last so many years, and the disability already is only about 60% of your pay. So, paying for something that just might not pay out a lot may not make sense to some. But to others, it could mean avoiding bankruptcy (eg. Small business owners).

With disability also comes the thought of long-term disability and long-term care. If you are looking at long-term care plans, I would suggest looking at adding it to your life insurance policy, as it can be very expensive on a disability policy.

It’s currently open enrollment, so book a consultation with me if you would like to look at your disability insurance coverage options.

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