Insurance is an important part of covering you and your family in case of the unexpected. Have you ever considered what would happen if you became disabled and were unable to work? It’s a stressful situation to consider, but not an uncommon one. In fact, a quarter of 20-year-olds will become disabled for more than a year before retirement, according to the Social Security Administration. 

In some cases, if you are unable to do any type of meaningful work, you might be able to collect Social Security Disability Insurance (SSDI) from the federal government. But these payments would not fully replace your lost income, and not every disabled person qualifies for SSDI. 

This is why some people purchase private disability insurance coverage. Disability insurance replaces part of a worker’s income if they’re unable to work due to an injury or illness. Here’s why this customer purchased a policy through Breeze: 

Disability insurance policies come in two main flavors: short-term and long-term. They both provide income if you’re unable to work but for different time frames. Many employers offer short- and long-term disability insurance as an HR benefit. If you don’t have employer-provided disability insurance, you may be able to purchase it on your own. If you are purchasing independently, Trustpilot reviews can help you understand the experiences of other customers with these different types of policies.

Under a short-term disability policy, you’d typically collect 40%–70% of your normal salary for six weeks up to a year for situations like pregnancy, accidents, injuries, or illnesses. It typically would not cover an injury sustained while on the job, because on-the-job injuries would fall under workers’ compensation. 

Most short-term disability policies offer “own occupation” coverage, meaning you’d be covered if you’re unable to perform the tasks of your job. Under “own occupation” coverage, you may find another job and still receive full benefit payments. Short-term disability insurance with this coverage is preferable to insurance that requires you to be completely disabled from all forms of work. 

Disability insurance policies also come with an elimination period. This is the amount of time you must wait before insurance benefits start. A 14-day elimination period is common, but it could be as long as 30 days. 

Long-term disability insurance covers 10%–60% of your income if you’re unable to work for an extended period of time due to a disability. Before you can collect long-term disability benefits, you must use up all the sick leave from your job and be disabled for a minimum amount of time, typically six months. You can use employer sick leave during the elimination period. 

Long-term disability insurance policies may define work as “own occupation” or “any occupation.” Many “own occupation” policies transition to “any occupation” after paying benefits for two years. 

SSDI is a government program for people who are unable to work for at least a year due to a disabling condition. It has a five-month waiting period and can require significant documentation to provide your disability. 

To qualify for SSDI, the disabled person must have held a job that paid into Social Security. Many local, state, or federal government jobs do not pay into Social Security, so those workers would not qualify. 

SSDI benefit checks may also be smaller than what you’d get from a private disability policy. The average monthly SSDI benefit was just over $1,200 in 2019, and if that was someone’s sole source of income, they would barely reach the federal poverty line. 

Due to the stress and complexity of disability claims, some people use a company like Allsup to advocate for them: 

Here’s a look at factors to consider when selecting disability insurance: 

• Employer options: If you have disability insurance through work, but you’re considering switching jobs, your policy may not move with you. That’s one reason to consider purchasing a private policy. 

• Elimination period: How long can you afford to wait before collecting disability benefits? A larger emergency fund may mean you can stay afloat during a longer elimination period. 

• Own occupation vs. any occupation: An “own occupation” policy may be more expensive compared to an “any occupation” policy, but it won’t be as strict at paying insurance benefits. 

• Premiums: Your age and overall health, the percentage of income replaced, the waiting period, and the length of time covered will affect the cost of your policy. To ensure that you can keep up with premiums, you’ll wait to weigh factors you can choose (like waiting period or level of income protection) against how much you can afford in premiums. 

• Cost-of-living increases: The disability benefit that seems generous today likely won’t have as much buying power in 10 years due to inflation. Many policies do not have a cost-of-living rider, but it’s something to consider if you’re concerned about inflation. 

• Renewability: Ideally, your disability insurance policy would be non-cancelable with a guaranteed renewal, so that your premiums can’t spike beyond what you can afford. 

If you don’t have both types of disability coverage provided through work, then you may want to consider short-term and long-term policies to cover your bases. Do you have other insurance to cover your family in case of emergency? 

The right disability insurance policies can ensure that you have an income even when you can’t work due to a temporary or long-term disability. Consult a disability insurance expert to discuss your specific needs. Reading Trustpilot reviews can help you select a provider you can trust. 

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