According to statistics you are three times as likely to be disabled on the job than killed, and this makes a solid case for investing in disability insurance over life insurance. Yet, traditionally so many people will take life insurance over disability insurance, why is that?
This is because most people are not sure what disability is all about. The terms involved are often complex and in the end people just opt for the easy to understand life insurance policy. If this sounds familiar, this article will make an excellent introduction to the various considerations you will need for embarking on this new direction.
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-Should you buy your own policy or get it through work?
This will largely depend on how much you are making at work. Those who make over $200,000 in a year will find it more advantageous to take out their own policy. If you are one of the average earthlings just like you and me, a group disability policy through an employer is a more convenient option.
It is a common error to skip the disability insurance thinking that the Social Security disability will work just fine if needed. But this is a mistake, Social Security doesn’t pay out a sizable benefit and is much harder to qualify for than your disability benefit as provided in a group through your employer.
-Do plenty of background research
Whenever you are considering obtaining this kind of insurance policy it is a good idea to get a good overview of all the subject matter before you make a final decision. Many online resources can give you clues on the dynamics of these policies and what the best deals for your situations would look like. You can also get a free quote off many of these sites along with a summary of what you will get.
-Find an insurance agent
After you have carefully studied these online resources you will need more information and need as many quotes as possible to find the best selection for you. By getting in touch with an insurance agent or broker you can find some more quotes from various providers.
– Buy at 60% of your current pay
You will want to look for a policy that can begin making the regular payouts within three months of your disability and continue until you are passed 65. Make sure you’re getting a coverage that is equal to 60% of your current pay rate before taxes are deducted. This will average out what you are taking home after taxes.
-Work With a Strong Insurer
Regulatory boards like A.M. Best will give pout rating to those companies that exceed expectations. Strong insurers have a greater financial strength and higher payout rate.
-Be sure your policy covers your specific specialty
Whether you are a painter, construction worker or civil engineer, you will want to be sure the position you are considering actually covers your specialty.
Perhaps this is one of those acquisitions that we hope we will never need to use, but you will be grateful it is in place if you were to become disabled as it will protect your future and your loved ones through the years.