If you become disabled and cannot work for a period of time, would you be able to continue paying your living expenses? Disability insurance can provide the income you need until you can return to work.

Short-term financial needs

Consider how a short–term disruption in income can significantly affect your long-term financial responsibilities. Even a brief period of disability can impact your long-term financial stability if you are not adequately protected. The problem can escalate to a bigger issue, affecting your finances for a long time.

Disability insurance policy basics

Policies vary among insurance companies, but there are four main features of a disability policy that you should know:

• Benefit amount: The amount of income you are protecting. This can be represented as a percentage of your income, or a specific dollar amount.
• Benefit period: The length of time your benefits will pay. This can be set at one, two, or five years, or you can receive benefits until age 65 or for the rest of your life.
• Disability definition: This determines when you are considered disabled. This can be defined as being disabled from your occupation or from any occupation.
• Elimination period: Also referred to as an exclusion period. It is the length of time you must be disabled before benefits begin. This period can be set at 30, 60, 90 days, or as much as one or two years.