What is Disability Income Insurance?


Disability insurance is the foundation of any financial plan. Everything you own and everyone you provide for relies on your ability to generate income. Without income everything you have worked so hard for can come crashing down. The need for disability insurance is immediate and can begin even before the need for life insurance. The chances of a disability, prior to 65, are 5 times greater than that of death.

Disability Income Insurance is a form of insurance that insures the beneficiary's earned income against the risk that a disability will make working, and therefore, earning money, impossible. It includes paid sick leave, short-term disability benefits, and long-term disability benefits.



Who Needs Disability Income Insurance?
More than a quarter of today's 20-year-olds will become disabled, according to the Social Security Administration (SSA). No matter what job you have. It does not have to be a freak injury that prevents you from working – back injuries, cancer, heart disease or other illnesses are the majority of the reasons for long-term absences.

Are you prepared if you can't work due to a long-term disability? The average long-term disability last 2 1/2 years; do you have the emergency savings to cover that long away from work? If not, you need to make sure you have long-term disability insurance.

Through a great benefit, employer provided disability insurance or Group LTD is in many cases inadequate. Group LTD often only covers your base salary and the benefits are treated as taxable income. Make sure to perform a disability insurance review. Hettesheimer Insurance Agency will shop the market for the best plan at the right price, and help our disability insurance brokers present their clients with options from only the best companies.


Group Disability Insurance
Group insurance is mandated by most states, but employers differ as to the type of coverage offered. Many employers offer income protection coverage in the form of sick leave. About half of employers offer group disability insurance. Benefits from group disability insurance typically last until the retirement age. Most group disability plans are not guaranteed in any way, and can be terminated at any time the employer or the insurance company decides to stop offering it. For businesses, disability insurance can be used to pay the business expenses of a disabled owner, buyout a disabled owner's stock or replace lost revenue from a disabled key employee.


Individual Disability Insurance
Individual disability insurance offers multiple options for coverage, and a policy can be tailored to your needs. Furthermore, since individual disability insurance policies are paid with after-tax dollars, you don't pay taxes on the benefits you receive on an individual disability claim.