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Insurance Replaces Income: Help for Disability

If you have been unable to work due to a serious injury or illness, disability income insurance was designed specifically for you. In a nutshell, disability income insurance replaces a percentage of your regular income, usually 70% or less, while you are disabled. Unfortunately, however, many Americans do not receive the benefits they deserve because they are unfamiliar with this particular insurance policy.

Because having a thorough understanding of the disability income insurance provided by your particular insurance policy is key, the next few paragraphs will give you a quick overview of disability income insurance and what to expect if you should ever find yourself temporarily or permanently disabled. Please remember, however, that each insurance policy differs slightly, and knowing the general basics of disability income insurance is not a substitute for familiarizing yourself with your individual policy.

A General Overview of Disability Income Insurance

It is extremely important to have a general overview of disability income insurance. Most insurance policies break disability income insurance into two groups: short term and long term. Short term benefits normally start after all paid sick/personal/family days have been exhausted and last about three to six months. Normally, short term benefits replace about 70% of an individual's normal pay. Long term benefits, which pick up where short term benefits leave off and may last until the individual turns 65, also replace a significant portion of income, though usually less than 70%.

While most group insurance policies offer some type of disability income insurance, some people may wish to purchase additional individual plans to supplement their employer's policy. This is highly recommended for those in very high risk occupations, such as miners or firefighters. Additionally, it is important to note that disability income insurance replaces a certain percentage of normal wages UP TO a certain dollar amount. Thus, if you are in the very high pay range, you may have considerably less than 70% of your wages replaced. For this reason, an additional insurance policy might be beneficial.

While no one wants to suffer from a disability, disability income insurance can at least reduce the financial strain on the individual and his/her family. For this reason, every worker should attempt to have at least some coverage, especially those with families. With such a wide variety of insurance policies available in America today, a little time and research should be enough to help you find the perfect policy for your situation. Good luck!

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