The Skinny on Disability Insurance

You purchase auto insurance, probably homeowners insurance, perhaps even life insurance, but if you’re still working have you protected your income?  Disability insurance replaces a portion of your income if an accident or illness stops you from working.  If you are self-employed you NEED this insurance!

Multiple sclerosis ended Robert Howe’s career as a dentist. Only 53, Dr. Howe no longer works, but he is still receiving a monthly check that comes close to matching his old income.  The reason:  a disability insurance policy.

You can buy a full policy if you’re self-employed or a supplemental if your employer’s policy is minimal. The policies pay monthly benefits if you are not able to work and some pay partial benefits if you can only work part-time.  Protecting your income/savings is especially important as we age and begin thinking about building up our retirement savings. The most common disability claims for 50 and older:  cancer, arthritis, joint inflammation and back strain.

Coverage, availability and price depends on your health, age, tobacco use, and of course, on your occupation and the level of income you want to replace. A basic medical exam should be expected and pre-existing conditions may be excluded or a surcharge may be added. The older you are when you purchase coverage the higher the premium. For instance, a policy that pays a $5,000 monthly benefit through age 66 for a healthy 55-year-old male might cost $3,840 a year; the same policy may cost $2,228 a year for a healthy 50-year-old male.

Disability insurance usually covers from 50% to 70% of your gross income.  You will need to add up your expenses and other sources of income to calculate the amount of insurance you need.  Plus, you will need to figure the length of time you want to receive a monthly benefit.

At W3 we understand your needs, and are ready to answer your questions. Contact Abbey Bowersox at 727.522.7777 ext 150 for more information.