Your ability to earn an income is your most important asset.
Your income provides you and your family the lifestyle you are accustomed to. Lose your ability to work, you could lose your income. Risk management is recognizing your risks and choosing how you want to manage that risk.
Bad things happen to good people. And depending on what happens, be it an accident or an illness, your ability to work and earn an income could be in affected. How will you maintain your lifestyle is your income stops or is reduced?
Disability insures your health and not your life. Life Insurance is for someone else, disability is for YOU.
Dennis is a specialist in the disability income products. Your insurability depends on many factors from what your occupation is, to your income to your health status. We represent the major companies in the disability business. The product and carrier we recommend depends on the factors mentioned prior. The carriers do not all look at a risk the same or even offer products that work for all occupations.
You may have group disability through your employer. That is great but be sure to read the contract and understand what is covered and for how much. Group disability is far less expensive because it doesn’t cover you as well. You may be surprised to find out there is a cap on what your monthly benefit amount is and/or it does NOT cover your income fully. You can wrap a personal disability plan around your group benefits for additional coverage.
Important definitions with disability income plans:
- What is the definition of a disability? All insurance is a promise to pay based on the language of the contract. The best definition is to insure your ability to do your current occupation. If you are unable to do the material and substantial duties of your regular occupation, you should be disabled. Group disability usually limits this period, if it is included at all, to a finite time such as two years. After that time, the definition changes to “anything you can do for an income.” Many people add personal disability just to protect this possibility.
- Residual or partial disability – what happens if you can’t work full time anymore but you can do somethings or you can’t work as many hours as you did before? Maybe this could be a short term issue or a permanent problem. Partial disability says if you have lost more than 20% of your income but still working, you are eligible for a partial disability check.
- Cost of Living (COLA) – if you are off a long time, COLA increases the monthly benefit each anniversary to keep your spending power the same. Group disability does not always include COLA.
- Return of Premiums – certain companies offer this rider that actually will return your premiums minus any benefits paid out after so many years of coverage.
- Long Term Care Rider – if you can’t do the a couple of the daily activities of living you are eligible for an additional benefit to pay for your care in addition to the income benefit. This pays for someone to take care of you.
If you need a conversation about your disability income planning, talk to us, we know this marketplace.