Disability Insurance
What is Disability Insurance?
Disability insurance is a type of coverage that protects you when one of your most important assets is gone – the ability to work and earn an income. If you become severely injured or ill and you’re unable to work, disability insurance ensures the continuity of your income by helping replace a portion of your monthly income tax-free. Having disability insurance means you still have the financial security to pay off your bills and expenses when you can no longer earn an income due to a disability.
What are the Benefits of Disability Insurance?
Most causes of disabilities are recognizable, such as a severe injury or illness, but there are disabilities that many people may not be aware of, such as chronic pain or mental health issues. Having disability insurance allows you to protect your financial future and provide you Space to Breathe. Although disability insurance may be offered by your employer, the coverage ends when you leave or change jobs. Getting an independent disability insurance plan provides you the most comprehensive, stable, and reliable coverage that’s tailored to your needs.
How Does Disability Insurance Work?
Disability insurance typically replace up to 60% to 85% of your regular income, up to a maximum amount. Depending on your plan, your premium, benefit amount (which is tax-free), and benefit period will vary. Once you file a claim when you become disabled and your waiting period is over, you will receive monthly payments, and they will stop when the benefit period ends or you return back to work.
Types of Disability Insurance
At Cove, we offer two types of disability insurance coverage: disability income insurance and business overhead expense insurance.
Disability Income Insurance
Disability income insurance provides you a source of replacement income if you have a disability, which allows you to continue meeting your financial commitments.
Business Overhead Expense Insurance
If you’re the owner of a business, getting business overhead expense insurance can help if you or a co-owner becomes disabled and are unable to generate income. Business overhead expense insurance helps businesses meet their ongoing expenses, such as rent, property taxes, utilities, and salaries, when you or a co-owner faces a disability.
Disability Insurance 101
How much does disability insurance cost per month?
The cost varies based on the age, gender, smoker status, occupation, medical history, and lifestyle of the person being insured. The amount being applied for also affects the cost – the more you purchase, the more it will cost. Prices can range from $50 per month up to hundreds per month based on the above variables.
How hard is it to get disability insurance?
Disability insurance is easy to get if you are healthy, have no adverse medical history, and don’t participate in risky activities. For individuals who have existing or past injuries, an adverse medical history, or participate in hazardous sports, it may be difficult to get disability insurance at standard rates without exclusions or at all. It is possible that a seemingly fully functioning person may not be able to get disability insurance because of their medical history, so we encourage everyone who needs or wants disability insurance to get it as soon as you can to avoid the complications of health conditions or lifestyle choices that would prevent you from getting disability insurance.
How much do you receive when you’re on disability insurance?
The amount you receive is dependent on how much you buy. You can buy any amount of coverage up to a maximum amount set by the insurance company based on your income. Insurance companies won’t insure your income on a dollar-for-dollar basis but will insure only a percentage of your income. The percentage decreases as your income goes up so you can never be “over insured”. It is best to get as much as you can because it will never be as much as your current take home pay.