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Disability Income Insurance

Do I Need Disability Income Insurance?

Although most of us are aware of the need for health insurance coverage when determining our risk management needs, many of us fail to consider the possibility that we could become disabled. A disability income insurance policy can help replace income lost because of an injury or illness. Few people would have an adequate “war chest” for an extended battle with a loss of income.

Unfortunately, many of us will need disability income protection before we retire. Without the appropriate coverage, a disability could spell financial disaster.

Disability at any age can disrupt income while medical expenses mount. Unless you have a battle plan, the effects of even a short-term disability could be financially debilitating and emotionally devastating.

Disability Protection

In the event that you become disabled and are unable to work, the benefits provided by disability insurance can help replace a portion of your earned income.

The appropriate amount of disability coverage will depend on your particular situation. However, there are a few issues you may want to consider.

First, consider carrying enough coverage to replace at least 60% of your earnings. Many companies limit benefits to between 50% and 80% from all sources of disability income prior to the disability. This would mean, for example, that the amount of any Social Security disability payments you receive could be deducted from your benefit amount.

If you are concerned about the cost of a private disability insurance policy, consider extending the waiting period, which is the time between the onset of the disability and when you start receiving benefits. Choosing a 90-day or 180-day waiting period (instead of 30 days) may help lower your premium.

Be sure to compare and review policy benefits carefully. Disability insurance can be an affordable way to help protect your assets in the event of a disability.

 

The information in this newsletter is not intended as tax, legal, investment, or retirement advice or recommendations, and it may not be relied on for the ­purpose of ­avoiding any ­federal tax penalties. You are encouraged to seek advice from an independent tax or legal professional. The content is derived from sources believed to be accurate. Neither the information presented nor any opinion expressed constitutes a solicitation for the ­purchase or sale of any security. This material was written and prepared by Broadridge Advisor Solutions. © 2020 Broadridge Investor Communication Solutions, Inc.


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Securities offered through Equitable Advisors, LLC (212-314-4600), member FINRA/SIPC. Investment advisory products and services offered through Equitable Advisors, LLC, an investment advisor registered with the SEC. Annuity and insurance products offered through Equitable Network, LLC and its insurance agency subsidiaries. Equitable Network, LLC does business in California as Equitable Network Insurance Agency of California, LLC and, in Utah, Equitable Network Insurance Agency of Utah, LLC. Equitable Advisors and its affiliates do not provide tax or legal advice. Individuals may transact business and/or respond to inquiries only in state(s) in which they are properly registered and/or licensed. The information in this web site is not investment or securities advice and does not constitute an offer.

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