| What is Disability Insurance? | | | | Types of Disability Insurance |
| "The Social Security and Supplemental | | | | Most people are familiar with two types |
| Security Income disability programs are | | | | of disability insurance: short-term |
| the largest of several Federal programs | | | | disability, and long-term disability. |
| that provide assistance to people with | | | | Short-term disability insurance is |
| disabilities. While these two programs | | | | included as part of a benefits package |
| are different in many ways, both are | | | | with many different employers, and |
| administered by the Social Security | | | | usually provides an income in the early |
| Administration and only individuals who | | | | part of disability. Short-term |
| have a disability and meet medical | | | | disability insurance generally provides |
| criteria may qualify for benefits under | | | | coverage for a period of several weeks, |
| either program." | | | | and does not exceed a two-year term. |
| - Social Security web site, June 2006 | | | | Long-term disability, however, can last |
| The Social Security office will want to | | | | for a period of several years. These |
| check your medical history to be sure | | | | types of policies may be included as a |
| you qualify for disability benefits. | | | | part of employment, in a benefits |
| The Social Security office is one way to | | | | package, but many purchase these |
| get disability benefits, but in most | | | | disability insurance policies |
| cases these benefits will not be | | | | individually. |
| substantial enough for families. | | | | As far as disability insurance goes, |
| Disability insurance can be obtained | | | | however, there are still more policies |
| through any number of insurance | | | | to learn about. One type of disability |
| companies. In the event that you are | | | | insurance is the Own-Occupation |
| disabled, this insurance will serve as | | | | Disability Insurance. The definition of |
| financial protection. You will receive | | | | this policy reads: |
| a percentage of your gross income from | | | | "The inability to perform the material |
| your disability insurance policy, income | | | | and substantial duties of your regular |
| that will ensure your own financial | | | | occupation, the insurance company will |
| safety. | | | | consider your occupation to be the |
| You do not have to go through the Social | | | | occupation you are engaged in at the |
| Security Office to take out a disability | | | | time you become disabled, they will pay |
| insurance policy, nor to receive the | | | | the claim even if you are working in |
| benefits from that policy. The Social | | | | some other capacity." |
| Security disability program is not | | | | Another kind of disability insurance is |
| related to any disability insurance | | | | the Income Replacement Insurance. This |
| policy that you take out. | | | | is a very popular type of disability |
| "Individual disability insurance is | | | | insurance, and most insurance agents are |
| truly a basic concept. It is an | | | | familiar with this policy. The language |
| insurance product designed to replace | | | | of this type of disability insurance |
| anywhere from 45-60% of your gross | | | | reads: |
| income on a tax-free basis should a | | | | "Because of sickness or injury you are |
| sickness or illness prevent you from | | | | unable to perform the material and |
| earning an income in your occupation. | | | | substantial duties of your occupation, |
| Every disability insurance policy from | | | | and are not engaged in any other |
| every insurance company is very | | | | occupation." |
| different, this is not a product to | | | | Common in employee benefits packages, |
| simply shop for the most competitive | | | | Gainful Occupation Coverage is another |
| rate. To buy the cheapest disability | | | | popular form of disability insurance. |
| insurance policy on the market is to | | | | The language here is worded very |
| throw money away. The odds of getting | | | | carefully: |
| paid a monthly benefit under a cheap | | | | "Because of sickness or injury you are |
| contract may be significantly lower than | | | | unable to perform the material and |
| receiving benefits from a quality | | | | substantial duties or your occupation, |
| contract." | | | | or any occupation for which you are |
| - About Disability Insurance web site, | | | | deemed reasonably qualified by |
| June 2006 | | | | education, training, or experience. |