Disability Insurance – Do I need it? Why is it important?
What would happen if you became disabled and were unable to work? Would you be able to continue to pay for bills and living expenses?
Disability Insurance can help answer these questions. According to the Council for Disability Awareness, the average long-term disability claim lasts 34.6 months and most people don’t have enough savings to support them for that long. Disability Insurance is intended to help provide a portion of your income if an injury or illness leaves you unable to work.
Who Should Consider Disability Insurance?
Anyone who is working should consider Disability Insurance. Single people, single parents, two-income families, and business owners should all consider how they could be affected if they can no longer earn an income.
- Single people have only their own income to rely on. If they are unable to work, how would they maintain their financial independence?
- Single parents are typically the financial rock for their children or other dependents. An illness or injury could have a significant affect on a single parent’s ability to earn a living.
- Two-income families have become accustomed to a lifestyle based on both incomes. There are likely to be more bills, especially if they have children.
- Business owners play an integral role in ensuring the business continues to run smoothly. If they become disabled, there are still operating costs like utilities and employee salaries that need to be paid to keep the business running. On top of that, business owners must also worry about their own personal expenses and how they will continue to earn a living.
Maybe you already have Disability Insurance through your employer. You will want to review it to determine what your benefit amount will be, the waiting period (how long you must be disabled before the benefits kick in), and what the benefit period is (how long the insurance will pay benefits to you). Is the monthly benefit amount enough to support you during the disability?
How much Disability Insurance would you need to maintain your current standard of living?
Whether or not you currently have Disability Insurance through your employer, there are some great tools available to help you determine how much Disability Insurance you would need. Life Happens provides a Disability Insurance Needs Calculator to get you started. From there, you can reach out to your insurance agent to have a discussion about the options available to obtain Disability Insurance.
We don’t know when we may become disabled, but Disability Insurance can help provide us some peace of mind when it does.