Disability Insurance:­ How will you cover your income?

Statistics show that over their working lives many American workers will suffer a disability that could potentially wipe out their retirement savings, deplete family emergency funds, and/or require the sale of assets such as the family home.

And, regardless of your profession, career, or business, the fact that a long-term disability might destroy your financial security can be a daunting realization. The most troubling part of disability is that the family or loved ones of the disabled person might be relying completely on the disabled person's ability to earn the income necessary to pay all of the monthly bills, rent or mortgage, car payments, and put food on the table.

The premium cost of disability income insurance is governed by several factors. The first step is to choose an income amount that will cover your monthly expenses and also fit the percentage allowed by the insurance company, generally a maximum of 75% of your income. Next, chose a waiting period that will need to be met before benefits are paid, something like three to six months. Then consider how long benefits will be paid i.e., age 65 or life. The sooner you chose to start receiving benefits and the longer you receive them will govern the premiums you pay.

Disability income insurance is designed to cover the time when you are unable to perform the duties of your career or profession because of illness or injury (non-work related - that would be covered by workers compensation).

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