What is disability insurance?
Disability insurance pays some or all of a worker's salary if that worker becomes disabled and is unable to work at his or her job. According to the Council for Disability Awareness, at least one out of every four workers will become disabled at some point during their working career. This disability can come from accidents or injuries on the job, as well as from other debilitating illnesses such as cancer or a heart attack. Disability insurance can reimburse disabled workers for some of the income they lose while recovering from illnesses and injuries.
Why get disability insurance?
Unlike Social Security disability, which covers most workers after they reach a certain age and is capped at a maximum monthly payment regardless of the worker's salary, private disability insurance can cover about 70 percent of a worker's salary at any age when a disability arises. Some workers may be covered by disability insurance through their employers, but many workers have limited coverage or no coverage at all. Individuals with little or no coverage can buy private disability insurance in order to protect their earning power and provide for their families should they be prevented from working by an illness or injury.