Do you have disability insurance? It’s a simple yet life saving question that many don’t think about until it is too late. You may be thinking that you are young, don’t work a high risk job, or that employee benefits are enough. Yet the truth is that life happens, and with that comes unexpected illness or injuries.
No matter your age or risk level, no one is exempt from facing a disability. In fact, one in four of today’s 20-year-olds can expect to be out of work for at least a year because of a disabling condition before they reach the normal retirement age. Each year around 5% of working Americans will experience a short-term disability, around six months or less, due to illness, injury, or pregnancy. Almost all of these are non-occupational in origin
While this may be an alarming statistic, what is even more worrying is how many people are prepared, or lack thereof, to face the financial setback of a disability without proper insurance. Only 40 percent of US households have enough in liquid savings to cover at least three months of their recurring expenses, and only 28 percent can cover at least six months.
Often the hesitation with securing a disability insurance plan is feeling like you won’t ever need it. As mentioned earlier, that is a large risk to take given how many people face illness and injury that takes them away from work. To put it into perspective, here are the most common reasons for disability insurance claims:
The most common reasons for short-term disability claims are:
- Pregnancies (22.3%)
- Musculoskeletal disorders affecting the back and spine, knees, hips, shoulders, and other parts of the body (18.5%)
- Injuries such as fractures, sprains, and strains of muscles and ligaments (11.4%)
- Digestive disorders, such as hernias and gastritis (7.4%)
- Mental health issues including depression and anxiety (7.3%)
The most common reasons for long-term disability claims are:
- Musculoskeletal disorders (27.6%)
- Cancer (15.0%)
- Injuries such as fractures, sprains, and strains of muscles and ligaments (12.0%)
- Mental health issues (9.3%)
- Circulatory (heart attack, stroke) (8.2%)
Did you know that Workers’ Compensation only covers time away from work if the disabling illness or injury was directly work-related? Yet, in 2019, less than one percent of American workers missed work because of an occupational illness or injury. Meaning disability insurance is a must.
So what does it offer? Financial security. It works to cover your expenses and give a payout on par with your income to ensure that you can continue to live life while paying medical bills, house payments, debt payments, and more. There are two types of disability insurance claims: short-term and long-term.
While policies can vary and are dependent on your personal situation, short term disability insurance typically covers you for anywhere between 3-6 months. Short term disability insurance also can ensure a greater percentage of your income versus long term. For short term, this coverage can go up to 70%.
Long term disability is designed to provide these benefits for a longer period. It can provide for years rather than months with periods for long term disability insurance going anywhere from 5 to 20 year or even until you reach retirement age, dependent on your plan.
Life happens, be prepared.
At Heroes Sick Pay we take the stress out of insurance and work to find you a plan that suits your lifestyle and needs.