Could you afford to be without a paycheck for three months–or longer?
“Our ability to earn an income is perhaps our greatest asset–greater than any home or auto we’ll ever own,” said Tim Bemis, insurance services regional manager at Dupaco Insurance Services. “We insure the home and car. But most of us overlook insuring ourselves and our income.”
Here are five truths about disability insurance worth considering:
The disability chance is real
The odds that you’ll become disabled are greater than most realize.
Studies show that a 20-year-old worker has a one-in-four chance of becoming disabled before reaching full retirement age, according to the Social Security Administration.
Disability can be lengthy
The average individual disability claim lasts 31.6 months. And one in eight workers will be disabled for five years or more during their working careers, according to the Council for Disability Awareness.
Disability insurance provides financial relief
Anyone who can’t afford to live without an income should carry disability insurance, Bemis said.
Higher-risk occupations will face higher premiums. But the risk of a disability is greater.
“There will be some folks with enough in their rainy day fund to get by for possibly several months. But anything longer becomes a severe financial hardship,” Bemis said. “Like any other product, disability insurance has to be affordable and fit into a family budget. But it should be given the priority in the budget that it deserves.”
Protect outstanding loans
For the what-ifs in life, Dupaco members also can find financial relief through the financial cooperative’s voluntary Payment Protection program.
When participants unexpectedly suffer from a protected life event, like a disability, Payment Protection might cancel or reduce repayment of their loan debt during that difficult time.
Eligible members pay the same fee and only buy enough protection to cover their loan balance.
Lower your odds of becoming disabled
The majority of disability claims are caused by illnesses rather than accidents.
Adopting healthier habits, including maintaining a healthy body weight and getting regular checkups, can decrease your risk of disability.
You can get more prevention tips here.