Disability Income Insurance

Disability income insurance is an often overlooked benefit. We specialize in making sure your income is fully insured because the odds are high that a 35-year-old is at risk of missing more than 90 consecutive days of work due to an illness or injury before age 65. The right disability insurance policy can protect you against the loss of your income in such situations.

It is wise to accept your employer’s group benefits if available, but you should be fully aware of its limitations. In some cases you may be able to purchase your own individual disability insurance to supplement this group coverage. 

• You may be able to obtain broader coverage than employer-provided policies typically provide.  
• Any benefits you receive are generally tax-free if you pay premiums personally. Benefits from employer-provided insurance are generally taxable if your employer pays your premium.  
• Your company-sponsored insurance plan will offset whatever benefits you qualify for by subtracting payments under your state disability insurance, workers' compensation and Social Security disability benefits.  A personal policy will generally pay benefits without any offsets.
• Company-sponsored disability insurance is generally not medically underwritten which is good if you are medically uninsurable, but understand that coverage usually stops when employment ends. Individual policies are fully medically and financially underwritten and the policy will remain in force if you lose your job or move to an employer who does not offer a group plan.

When applying for your own policy, be prepared to provide income tax returns for the last two years to document your past earnings. If you are self-employed, your benefits will be based on net earnings after business expenses, rather than gross business earnings.

Workers compensation covers only injuries suffered on the job, and eligibility and benefits vary by state. With a severe disability, you may qualify to receive Social Security disability benefits. However, this program requires a waiting period and carries many restrictions. Also, Social Security disability was not intended to be the sole source of disability income and benefits are often less than what is needed to cover regular living expenses.

A debilitating illness or injury that cuts off or reduces your primary source of income can be a financially devastating experience from which it can be difficult to recover. We can help determine how disability income insurance can take its place as a vital part of your insurance plan.