Disability Insurance Overview

Whether it’s supporting your daily living expenses today or funding your retirement savings for tomorrow, your ability to earn an income is your most important financial asset.

Many people purchase life insurance to help protect their families should they die prematurely. But according to data from the Society of Actuaries, people in their working years run a greater risk of being disabled for 90 days or more than they do of dying.1 Disability insurance can help.

We don’t often realize how easy it is to become disabled. Most people think disabilities are caused by accidents, when in reality the majority of disabilities are caused by illness.2

2008-2010 Claims Approved by Medical Cause of Disability*



Key Features of a Disability Insurance Policy

A disability income insurance policy pays a monthly benefit in the event of a disability. The monthly benefit amount can be used to replace income lost as a result of the disability, helping to meet ongoing financial obligations, and even maintain financial goals.

What Type of Disability Might You Face?

DIPyramidMost people automatically think of something dramatic like a car accident or stroke that would quickly render them totally and completely unable to work. In reality, disabilities are caused by accidents and illnesses from minor to severe – from headaches to cancer and everything in between. Some disabilities are sudden and serious, while others are milder, only slightly impacting one’s ability to work. And other disabilities develop slowly and worsen over time.

No one can know in advance, so it’s best to be prepared with disability insurance.

When evaluating a disability insurance policy, here are a few of the terms to become familiar with:

Definition of Disability
man falls from ladderWhen comparing policies, the definition of disability can make all the difference in the amount of protection offered. You should look for a policy with a definition of total disability that focuses on your ability (or inability) to do the duties of your occupation – the job you were doing when you became disabled. This is in contrast to some definitions which look at your ability to do any job or occupation. Depending on the circumstances of your disability, it could be more difficult to qualify for benefits with that type of policy.

It’s also important to look for a policy that pays for partial disability as well as total disability. A disability insurance policy that has partial disability protection allows you to collect benefits even while working part-time.

Beginning Date

This is the period of time you must remain disabled before being eligible to receive benefits. Since long-term disability income insurance policies are intended to provide benefits for longer-lasting disabilities, most specify at least a 3 month beginning date or waiting period.

  • Longer beginning dates are less expensive than shorter beginning dates, but,
  • The longer you wait to receive benefits, the more likely it is you will need to use savings to meet your financial obligations.
  • Most individual disability income insurance policies are issued with a 91 day beginning date.

Benefit Period

This is the length of time you would continue to receive benefits for an ongoing disability. Benefit periods of different lengths are often available.

  • Longer benefit periods are more expensive than shorter benefit periods, but,
  • Longer benefit periods provide better financial protection against a long-term disability.
  • Most disability insurance policies are issued with a To Age 65 or To Age 70 benefit period and provide benefits until likely retirement age.

The need for disability income protection is crucial and is an essential part of your financial plan. It provides an income for you and your family if you have an accident or health condition that prevents you from working and earning a paycheck.


  • 61% of wage earners personally know someone who has been disabled and unable to work for 3 months or longer. 1 in 8 workers will be disabled for 5 years or more during their career.
  • 65% of working Americans say they could not cover normal living expenses even for a year if they lost their income due to an illness or injury.
  • The average individual disability claim lasts 31.6 months.
  • The average disability payment from Social Security is $1,111 per month. 70% of Social Security disability applicants get denied.
  • Illness cases 9/10 of disabilities. 90% of injuries occur off the job.

A long term disability policy that has a benefit period of no less than five years along with an emergency fund can help assure that your family’s lifestyle is not vulnerable and can continue through a period of disability and loss of income.

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Need Advice?

Dave recommends choosing an amount equal to 60%
to 70% of your monthly income which can be reduced
based on your progress with debt and savings.

For more information click

  2 Years   5 Years   10 Years   To Age 65
Need Advice?

Dave recommends a minimum of at least a five year
benefit period and longerif your budget can afford it.

For more information click

  90 Days   180 Days
Need Advice?

Dave recommends taking the longest elimination
period your budget and emergency fund can afford.

For more information click


Please note: the information provided here is of a general information nature and is accurate to the best of our ability. We are insurance agents and not insurance experts. Please consult your own policy and with your own agent for specific coverage questions and concerns.