When asked, most people are hard pressed to explain what disability insurance really is. What’s even more – they often believe they don’t need it. In essence, disability insurance is the safety mechanism that protects your paycheck if you suffer an injury or illness and can’t work for an extended period of time. It replaces a portion of your income until you’re able to return to work again.
If you and your family rely on a paycheck to meet your day-to-day expenses, disability insurance should be a part of your contingency financial plan. For most people, who become too sick or injured to work – it takes about a month before serious financial trouble begins. How long can you afford to go on without regular income?
Even if you don’t work in a risky sector, you still have a three in 10 chance of suffering a disability that keeps you out of work for 90 days or longer at some point during your working career. What’s even more – about 90% of disabilities are caused by illnesses not accidents.
If, like most people, you have some kind of personal debt, such as a mortgage, rent, credit card bills or a student loan – regular income is vital to keeping you financially afloat. Would you be able to maintain your standard of living if you became too ill or injured to work for an extended length of time? And could you afford the piling costs of medical bills, transport expenses or home or other unforeseen needs that can be quite expensive? Getting disability insurance is the first step to securing your financial stability in the long term.