Debunking 5 Common Disability Income Insurance Myths
As with all types of insurance, disability income insurance is the type of protection you hope you never need to use. Disability income insurance is defined as the coverage that would pay periodic benefits, should you ever become injured or ill and were no longer able to work and earn a wage. So, for anyone who’s the primary income-earner in a household, disability income insurance would be critical to ensure that an unforeseen accident does not leave you and your family without a plan.
Let’s tackle five of the most common misconceptions when it comes to disability income insurance:
1. My standard workplace insurance is enough in the event of an accident
This myth perhaps arises from the understanding of worker’s compensation. Workplaces that offer worker’s compensation replace a percentage or all of an employee’s lost salary in the event of an accident at the workplace. Such plans are common in work environments with heavy duty equipment usage, where the risks of danger and severe injury are high. In these events, you can apply for worker’s compensation through your company.
There are a few reasons not to rely on this standard coverage. First, it is not a given that your workplace offers worker’s compensation. So, before assuming you’d be covered, it is imperative that you double check your coverage options. Secondly, even if you do have an employer who offers worker’s compensation, you still will want to consider a separate disability income insurance. Worker’s compensation is only offered to cover job-related injuries, and nine out of every ten long-term disability claims are for events that happen outside the workplace.
2. The likelihood of needing disability income insurance is very low
An attitude suggesting that you won’t become disabled by an injury or illness at some point in your life doesn’t add up with the statistics.
Part of the reason for this myth is that people only really consider disability events to be those that would leave them permanently disabled. Disability income insurance is also critical for minor to moderate injury events as well. An accident could leave you in severe pain for a year while undergoing physical therapy, or a simple broken bone could render you unable to complete your job until it’s healed. In these events, disability income insurance can step in to assist while your body heals. Data shows that around one in every four young Americans will encounter a disability event of one manner or another in their life.
3. I’m young and healthy, I’ll wait until I’m older to get disability income insurance
A study following long-term disability recipients found that four out of ten individuals were under the age of 50. Young workers are just as prone to accidents, and because they have had less time to save up or prepare financially, coverage is even more critical.
4. My employer offers group disability insurance, so I don’t need to think about individual disability income insurance
As with many insurance plans, it’s terrific when employers offer a baseline policy for coverage, but upon closer examination, you may discover that you require more coverage for your needs. Most group disability insurance plans will cover up to a given percentage of your salary, and you might look at that percentage and decide that it isn’t enough to sustain your family in the event of an accident – particularly if you are the only income earner in the family.
Group disability insurance will not follow you if you leave that job, so if you take time off or are in between jobs, you won’t be covered. These are all essential reasons to consider an individual disability income insurance plan.
5. What about Social Security—won’t that cover me?
Similar to group disability insurance, Social Security coverage will only replace a percentage of your lost income. The government is stringent in determining who gets a social security payout, as they are reserved for those who have the highest need for assistance. Individuals whose disability makes it impossible for them to work in their current job or any other type of occupation are eligible for these Social Security payouts.
Want to find out more?
Schechner Lifson Corporation can offer you help in addressing your disability income insurance concerns. With experienced and caring agents, we can make sure you get the right coverage, at a price that may just be more affordable than you think. Contact us today!