Disability Insurance is a vital policy that protects your most valuable asset: your ability to earn an income. If an injury or illness prevents you from working, this insurance provides a monthly benefit to help cover your living expenses, ensuring that a temporary or permanent disability doesn’t lead to financial devastation.
- What It Is: Insurance that replaces a portion of your income if you are unable to work due to an illness or injury.
- What It Covers:
- Income Replacement: Typically pays 50-70% of your gross income.
- Short-Term Policies: Cover periods from a few months up to two years.
- Long-Term Policies: Can provide benefits for several years or until retirement.
- Who It’s For: Anyone who relies on their income to pay living expenses.
- Key Considerations: Policies have an elimination period (a waiting period before benefits begin). The definition of disability is critical—”own occupation” is more comprehensive than “any occupation.”