What are the types of disability insurance?
There are two main types of disability insurance. Short-term disability insurance covers lost income for about three months, while long-term disability insurance typically pays a portion of your lost income for anywhere from one year to your entire working life. Often, people opt to have both types of coverage.
How much does disability insurance cost?
It depends on several factors including your benefit amount, benefit period, occupation, health status, age and terms of the policy. As a general rule of thumb, however, the cost of an individual long-term disability insurance policy is about 1% to 3% of your annual salary.
How do I get disability insurance?
You may have disability insurance through your employer. This is a nice benefit to have, but it may not be enough. And remember, the coverage ends if your employment there does. Talk with your benefits administrator to find out what kind of coverage you have and the duration.
Having an individual policy that you purchase and own is typically the most flexible and reliable way to get disability insurance coverage. An insurance professional can help you navigate all the options available, from length and amount of coverage, to getting a policy that covers your occupation, to making sure it is budget friendly.