Do you need to know the list of disabilities covered by disability insurance? Unfortunately, most people are unaware of how, when or if disability will strike them. Disability often comes in the form of an illness, instead of an accident. Illnesses that linger for over three months can devastate finances and create a burden on a person and her loved ones. Fortunately, disability insurance can provide an extra cushion at one of the most trying times in a person's life.
What Is Disability Insurance?
Disability insurance is a type of insurance that covers an individual when she can no longer work due to injury or illness. Disability insurance comes in multiple forms. One form is offered by employers as part of a group insurance package. The second form is individual disability insurance, and it is often purchased as a supplementary plan or as a primary plan if a person is self-employed. The third form is the Social Security disability insurance provided by the US government. This insurance is available to all individuals, including the elderly and those who are uninsured or under insured.
Types Of Disability Insurance
Disability can be divided into two groups-short term and long term. Short term disability is often referred to as sick leave. It is provided by an employer as part of the employment package. Short term disability is used most often at the birth of a baby, but it can also be used in the event of a loved one's short term injury. The duration of short term disability ranges depending on your employer. Expect anywhere from three to six months.
Long term disability begins at the end of short term disability. Because there is no federal law regulating long term disability, your employer may not be required to provide this type of insurance. In this event, it is crucial to have your own supplemental insurance because you simply do not know if your illness will last longer than three months.
What Is Covered In Disability Insurance?
Disability insurance coverage varies drastically depending on the policy provider. In most cases, serious and terminal illnesses that prevent you from working will be covered by disability insurance-but you must ask questions before you sign on the dotted line to make sure that you are properly covered. Injuries resulting from an on-the-job accident are almost always covered by a form of disability insurance known as Workers Compensation.
You should not expect disability insurance to provide you with a 100% match to your working salary. Disability insurance obtained for a job will generally provide between 60 to 75% of your working salary. Be aware that purchased disability insurance will often expire at retirement age, at which point you will have government coverage.
At its simplest, long-term disability insurance is exactly how it sounds; it issues payments in the event of a serious injury or illness. However, long-term disability insurance policies have many exceptions that govern the policy, so it's important to shop around for the right policy and read the details closely.
No one ever wants to consider the possibility of tragedy; this is why less than 50% of Americans hold life insurance policies. Although it might be prudent to prepare for any possible eventuality, we don't want to think about what might happen if we are injured or killed.|&&|
Individual disability insurance is one way in which people can prepare for their futures.
It is true that we do not know what tomorrow may hold. One day we may be perfectly healthy, and working, then suddenly encounter an illness. If you finances would be adversely affected if you became sick, then considering carrying disability insurance may be a good thing to do. Disability insurance would take over in the event that you were to get ill and be unable to work.