Disability insurance provides you with financial security when an accident or illness causes you to be disabled and unable to work or earn an income.
Disability insurance replaces a portion of your income. Policies differ on how soon you collect benefits and for how long. They also vary in whether disability benefits are received if you can’t perform the duties of your own occupation, a job in your field, or any job at all.
A person’s greatest asset is his or her ability to earn an income. Your financial security as well as many of your other financial plans, depends on the continuity of your salary or earned income.
Most people are unaware of the startling disability statistics. Often they have purchased life insurance to protect their families in the event of death. In fact, the odds are far greater that a person will become disabled in a given year than that he or she will die. Up to the age of 37, the chance of suffering a disability of at least 90 days is eight times as great as the chance of death. While death may be inevitable, disability is more probable at any given age.
A life insurance benefit is usually payable in a lump sum, and this payment ends the contract. Disability insurance benefits are almost always payable on a monthly basis, while disability continues. Upon recovery from a disability, the policy continues. Benefits could potentially be payable again for subsequent disabilities or for the recurrence of a prior disability.