Disability insurance is a lifeline when you cannot work due to a covered illness or an off-the-job accident. Trying to find information about long-term and short-term disability, and their relationship to each other, can be mind numbing. Many sites try to explain these products in terms only an insurance agent or lawyer can understand. Let’s try to simplify the discussion so you can understand these products better.
The two products don’t overlap — This is important, because many customers think they work together or interact at the same time. Short-term disability coverage may be for a few weeks or months at the most, then long-term disability begins after that. The gap in between is what’s important if you are looking at disability insurance because there may be some time when short-term disability ends before long-term disability coverage begins while you go through the qualification process.
The price of coverage is different — Long-term disability insurance coverage costs more than short-term, but you are getting more extensive coverage for that cost. How much it will cost depends on several factors; your age, sex, occupation, length of coverage, and how much of your normal pay you are replacing with insurance. Occupation is a big factor, because jobs considered more dangerous to insurance carriers are going to carry higher premiums.
You can’t buy short-term disability coverage — Some companies offer short-term and long-term coverage, some offer one or the other, and some may offer none. What you need to do depends on what is offered. If you have access to both, make sure you are enrolled with your employer. If you don’t get short-term disability coverage, it’s best to have 3-4 months pay kept aside as an emergency fund to cover your short-term disability until your employer’s long-term coverage can be activated. If you have no coverage, set aside the short-term emergency fund, then seek your own long-term disability coverage. Don’t risk your family’s wellbeing by believing you don’t need disability coverage, particularly if you have a risky job.
The coverage you need most is long-term disability — Many have suffered a short-term injury with minimal impact on the family or financial status. The problem can occur if you are injured and are unable to return to work for an extended time. This is when a long-term disability policy of your own will protect your family.
Contact the Insurance Hub today if you are interested in long-term disability coverage or have additional questions about disability insurance. We have a wide range of insurance products to give you peace of mind!