What is Individual Disability Insurance?
When someone is unable to work due to illness or injury, disability insurance is what covers part of their income. Unlike workers’ compensation insurance, disability insurance provides coverage for illnesses and injuries that do not occur on the job. If a group policy is not offered by their employer, workers should look into individual disability insurance policies in order to have part of their income covered in case they become disabled. Even if a worker has an employer-sponsored group plan, individual disability insurance plans can supplement the income covered by the group plan, which will typically only cover about 60 percent.
Individual disability insurance is offered as either a short or long term policy. Short term policies typically cover about one year of lost earnings, while long term policies cover lost earnings for disabilities lasting longer than
Who Needs Individual Disability Insurance Coverage, Anyway?
According to the Social Security Administration, about 1-in-4 of today’s 20-year old Americans become disabled before retirement age. Without the right individual disability insurance plan, a disabled contractor can be left without income for as long as their disability lasts. That being said, it’s important for anyone, especially contractors, who work dangerous jobs day in and day out, to have disability coverage
What are the Benefits of Individual Disability Insurance?
One of the best things about having an individual disability insurance policy is that it’s portable. That means if you leave your employer for another, you can hold on to your individual policy and still increase it as your income rises. Also, individual disability coverage cannot be cancelled by your insurance carrier as long as you make your payments on time.