Disability Income Insurance – Myths vs. Facts
Common myths debunked.
Disability Income insurance is complicated. Therefore, it’s no surprise that it’s so commonly misunderstood. Let us debunk five common myths:
- It won’t happen to me. Maybe you think it would only happen if you suffered a terrible accident, but that’s not true. Only 10% of disabilities are due to accidents. The other 90% are from illnesses, such as heart disease, cancer, and diabetes.1 A disability can happen to anyone, at any time.
- It’s too expensive. Consider the alternative. The average length of time for a long term disability for a 40-year old is 3.1 years, and one out of eight workers will become disabled for five years or longer during their lifetime.2 Could you afford to be out of work for three or even five years? It’s often said that the critical question may not be “can I afford disability insurance,” but rather “can I afford not to have it?”
- My employer group policy is enough. Employer group disability insurance is a great start. However, employer plans typically cover just 60% of your base salary, excluding bonuses and other compensation. Other limiting factors could also make it difficult to survive on employer coverage alone.
- I’ll get by using other resources. Not unless you’re one of the fortunate few who could survive an extended period without a paycheck. Social Security only kicks in if you’re permanently disabled, and it’s difficult to qualify for benefits. Without an income stream, you could easily deplete your savings, including money you have allocated for retirement.
- I won’t qualify for coverage. It’s true that your health is probably the single most important factor used to determine your eligibility for disability insurance. But even if you have a health condition, there are ways to obtain coverage. You may be able to purchase a policy with an exclusion for your particular condition, and in some cases, the insurer may reconsider your exclusion after a period of time.
It’s important to protect your financial future by insuring your income. Disability Income insurance can solve that problem. Connect with an Advisor to learn more.
2Council for Disability Awareness: https://disabilitycanhappen.org/disability-statistic/