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Disability Insurance – What is right for you?

It’s summertime! The kids are out of school and lots of us are thinking about vacations. What is the longest vacation you’ve ever taken? For me personally, it was 10 days. Statistically speaking your longest vacation was also less than 2 weeks. Why? Because we have to get back to work.

What would you do if you couldn’t get back to work?

It may surprise you to know that one in every four of today’s 20-year-olds will be faced with a disability before they retire. In fact, an estimated 2.1 million working-age Americans have experienced an illness or injury that keeps them from working this year alone.

If you are out of work because of an injury or illness you may have access to one or more of the following:

  • Short Term Disability

    • Generally voluntary (i.e., you pay for it) but sometimes an employer may pay for it
    • Replaces a portion of your weekly income if you are unable to work because of an illness or injury
    • The waiting period (amount of time you’ll need to be out of work to receive the benefit) is generally around a week
    • The coverage typically pays for no more than 90 or 180 days of being out of work because of that injury or illness
  • Long Term Disability

    • Evenly split between voluntary and employer-sponsored plans
    • Replaces a portion of your monthly income if you are unable to work because of an illness or injury
    • The waiting period is much longer (think 90 or even 180 days)
    • Coverage can be set up to pay for a couple of years from being out of work or until the age of retirement

Honorable mention goes to Workers Compensation insurance which only applies to work-related injuries:

  • Workers compensation:

    • Paid for by the employer
    • Covers treatment for work-related injuries
    • Replaces a portion of your weekly income if you are unable to work because of a work-related injury

Are you prepared financially for an illness or injury? Take some time to review your income protection plan. Your physical and mental wellness are your most important assets – make sure you are protected just in case.