California Personal Insurance Action Plan
California Renters: Don’t Forget About Insurance
Reducing the Costs of Disability Coverage
If you and your loved ones depend on your salary for support, then you probably need disability insurance. Think about it, if you were to become disabled, even for a few months, how would you and your family manage? Who would pay your bills? Disabling illness or injury is one of the leading causes of bankruptcy in the United States. Just like any other form of insurance, disability insurance promises compensation in the eventuality of an injury or handicap that prevents the policy owner from continuing his/her normal occupation.
If you are thirty-five years old, you have a 50/50 chance of experiencing a disability lasting three months or longer before you retire. One in seven workers will become disabled for more than five years before he or she reaches age 65. Many people mistakenly believe that the government or workers' compensation will pay them an income if they become disabled. Actually, more than 80% of the people who apply for Social Security disability benefits are rejected. Social Security does not pay benefits for partial or short-term disability. Your disability has to either last a year, or be expected to last a year, before you can collect Social Security. Worker's Compensation pays only if you were injured on the job and benefits are often limited to a few years.
Individual Disability Income Protection is a must for a business owner, and highly recommended for executives. If you are a business owner, you should consider purchasing both group and individual policies, if possible. As an executive, you should be sure to obtain group coverage if it is available. Only forty-three percent of large companies provide group long term disability insurance.