How Much Disability Insurance You Need:Explore More
Sep 8th, 2007 by Kaushik Adhikary
Image via WikipediaBoth Short-Term and Long-Term Disability Insurance have a waiting or elimination period after purchasing a policy within that period you’re not entitled to receive any benefit.If you take shorter waiting period,you have to pay higher premium & vice versa.
Most experts recommend that you should have a waiting period of 60-90 days. Here’s a point you should keep in mind that higher the risk or hazardous jobs you’re in,higher the premium you’ve to pay while all things remain the same.
Although the disability,resulting from accidental injury,may be inexpensive as it does not protect you adequately,you should be extra cautious including the disability coverages due to critical illness by paying additional premium.In case of STD policies,you may get up to 100% of your current salary with a limited period of time,whereas a typical group LTD insurance usually pay 40% to 60% at maximum of your current pay.
Experts usually recommend you to buy the policy that pay you long-term benefits until the age 65 at which point Social Security Disability Programs take over for the rest of your life.It is hereby noteworthy to mention that such LTD benefits are normally come under taxable income and at the you get much lesser cash in hand.If other deductions, such as payment from Social Security etc.are calculated-I wonder how much you would get.
Most importantly,do you need disability income insurance benefits at all and if you do need,then how much? You can work out that using a simple calculation.Simply add up all of your benefits & incomes from group coverage,government benefits,worker’s compensation, state vocational rehabilitation programs,automobile insurance,private insurance,veterans administration pension,civil service disability pay,benefits from life insurance,credit disability income insurance,medicaid,your spouse income,income from investments.
Now add up your monthly expenses,such as for food,clothing,living expenses,debt payments for your car,home & other loans,managing your future needs in the form of retirement,children’s education,health-care etc.Well,if your total income is found inadequate to support your day-to-day family expenses during your disability period, then you are recommended to buy an additional disability income insurance to make up this gap of scarce income.
In this limited context,I may not be covered all the necessary aspects of disability income insurance which I would discuss elaborately lateron.Please keep a watch up for that.
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To your better life
Kaushik
