Getting disability insurance is imperative especially if your line of work is susceptible to injury. However, what about everybody else? Here is how to tell whether or not you need disability insurance.
Most people fail to acknowledge just how important a steady income is to them. Even if you don’t live from paycheck to paycheck, it would not take much time for anyone’s funds to run out in the absence of a steady income. Due to lifestyle inflation, a good number of people cannot avoid bills and other expenditures for over a week or two.
So what would you do if you were unable to work all of a sudden?
When you are young and full of energy, it is difficult to envision a situation where you are unable to do physical work. That’s why countless people find themselves in situations where they don’t have an income anymore and have no idea how to cope. In most cases, such situations result in desperation, depression, and a lot of debts. This is where disability coverage comes in. Below are some important points about disability coverage to help you determine whether you need it or not.
What is Disability Insurance?
Simply put, disability coverage will partially replace your income in the event you can’t work due to illness or physical injury. Some common reasons why people utilize disability coverage include digestive disorders, pregnancy, back pain, and cancer. When women go on maternity leave, they often use their temporary disability coverage to reinstate their income.
Disability coverage is available in two types, namely short-term and long-term. Short-term disability coverage protects you for three to six months while long-term disability covers you for several years. Because short-term coverage protects you for a short time, it is more affordable than long-term plans.
Bear in mind that disability coverage only replaces about 60% of your income. Therefore, you shouldn’t depend on it entirely. Additionally, depending on your age, your income, the level of coverage, and whether you acquire it through your employer or not, disability coverage can be an expensive insurance policy. Usually, costs increase the older you get since you are more susceptible to getting hurt. Therefore, it is a wise idea to augment your emergency fund and continue saving for your retirement.
Is It Worth It?
Disability coverage isn’t necessary for everyone. Depending on your line of work, you may choose not to have one. However, disability coverage is imperative for people in specialized professions, such as masseuses or surgeons, as well as people in manual labor. If your profession is susceptible to injury, it is wise to invest in disability coverage.
Disability coverage and life insurance are almost the same. If your family does not depend on your income, you most likely will not require disability coverage. However, if you provide for your family, you should probably have disability insurance ready.
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