DISABILITY INSURANCE
Questions about disability insurance?
We've got answers.
Founded in 2000, Nashville-based Whitehall Benefits provides disability insurance (DI) benefits, to a national clientele in 50 states. We represent the most highly regarded carriers and offer:
Group disability plans
Supplemental plans
Corporate carve-outs
Individual policies
‘Own Occupation’ or ‘Own Specialty’ for superior coverage
Disability overhead expense and disability buy-out insurance
For more information about Disability Insurance, contact Don Hurwitz at don@whitehallbenefits.com Nationwide: 800-289-7724
What is Disability Insurance?
Disability insurance helps replace a portion of your income if you ever have to miss work or are only able to work on a reduced basis for an extended period of time due to illness or injury.
Because your ability to earn an income is perhaps your greatest asset, it makes sense to protect it with insurance coverage. Many workers, especially younger workers, tend to dismiss the risk of being sidelined by a serious illness or injury. No one really wants to imagine a future in which they are permanently unable to work.
The Social Security Administration’s actuarial tables estimate that a male or female worker born in 2000 has a 25 percent chance of becoming temporarily or permanently disabled between the ages of 20 and 67.
How can I get disability insurance?
Some employers provide a level of disability coverage to replace a portion of your salary if you cannot work. Employer plans often replace only 50-60 percent of a worker’s total earnings.
CHECK WITH YOUR EMPLOYER:
is disability coverage provided?
what percentage of your income would be covered?
how long would you be covered?
How much lost income will insurance replace?
The exact amount of income that disability insurance will replace depends on the specifics of your policy. In the broader sense, many employer-provided short-term disability policies will replace up to 60 percent of your base salary. An employer-provided long-term disability policy will typically replace 50-60 percent of your base salary. But neither short-term nor long-term employer policies typically replace bonuses or commissions. And in many cases, the monies paid to you will be counted as income and taxed as such. Do the math, and you can see why many individuals opt to purchase their own disability policy.
How can I get adequate income protection?
If you are not covered, or inadequately covered, by an employer’s group disability insurance offerings, it would be wise to look into personal coverage through a private insurance policy.
Such a policy could supplement or take the place of an employer’s plan. A private policy can also move with you from job to job. In many instances, a well-designed private long-term disability policy can, together with group coverage, cover up to 80 percent of your after-tax income, and can serve as powerful protection should the unexpected ever rob you of your ability to earn a living.
When Could I Claim My Disability Benefits?
Typically, you can make a disability claim and use the funds provided to help replace a portion of your income whenever illness or injury prevents you from working for a period of time.
This could include:
missing work for a couple of weeks while recovering from surgery
missing years of work due to an ongoing illness
depending on the specific details of your policy, you may even be able to cover a portion of your income until you reach retirement age, should you be physically unable to work for the rest of your career
How is disability insurance different from Workers’ Comp?
WORKERS’ COMPENSATION
Workers’ compensation insurance is provided by employers, most often based on government requirements. It is designed to cover medical bills and a portion of lost income when an employee is hurt on the job, or when an employee becomes sick as a result of working conditions. The cost of workers’ comp is usually borne by the employer or by the state.
DISABILITY INSURANCE
Disability insurance, by contrast, pays a portion of your lost income when illness or injury prevents you from working. This is true whether the cost of the disability insurance policy is paid in full by your employer, paid in part by your employer and in part by you, or independently purchased by you.
What is the difference between short-term and long-term disability?
WHAT IS SHORT-TERM DISABILITY?
Short-term disability coverage comes into play when you are temporarily unable to work, as in cases where an injury or illness keeps you off the job for a few weeks or a few months. Employers who provide disability coverage may only offer short-term coverage.
Some businesses also use short-term disability coverage to help cover income when a worker goes on maternity leave. Generally speaking, short-term disability covers periods lasting from a few weeks to a year, depending on the policy. Some policies include an “elimination period” that requires you be out of work for a week or so before the benefits of the policy become available.
WHAT ABOUT LONG-TERM DISABILITY?
As the name implies, long-term disability coverage comes into play when you are unable to work for an extended period of time. Examples include a prolonged struggle with an illness such as cancer, or the kind of lengthy recovery period required to come back from injuries sustained in a major automobile accident. In cases such as these, you may lose years of work, or the ability to ever work again. Benefits could last for years, or even until you reach retirement age.
Like short-term disability, an “elimination period” may be required before benefits kick in, although long-term disability elimination periods are typically significantly longer than those for short-term disability. In some instances, long-term benefits may become active once short-term disability benefits have ended.