Disability income insurance is designed to replace part of your income if illness or injury leaves you unable to work for an extended period of time.
While you never expect it to happen to you, statistics show that you have a roughly 3-in-10 chance of becoming disabled for 90 days or more before turning 651.
If you were hurt and unable to work, how long would you be able to pay your bills? In addition to your regular expenses, you may also have the burden of increased medical needs as a result of your illness or injury.
Farm Bureau offers disability income insurance that can help you stay financially secure through a difficult time. Disability income protection can provide monthly income in the event an accident or illness leaves you unable to work. Unlike proceeds from a group disability policy paid by your employer, you pay no income tax on benefits you receive from your disability insurance policy.2
You can customize your disability insurance coverage by selecting a specific type of policy and the length of time during which the monthly benefit will be paid, as well as the waiting period (number of days following a disability before you receive the monthly disability benefit). The monthly benefit amount is determined by your income and occupation.
The best time to buy disability income insurance is when you’re young and healthy — before you develop a sickness or injury that may make you uninsurable later. And, your annual premium will be considerably less at a younger age.
To help determine how much disability insurance you may need, start by taking an inventory of your monthly expenses. Include things like your mortgage or rent payments, car payments, insurance premiums, credit card and loan payments, food, clothing, utilities, day care and medical expenses not covered by insurance. Then, consider how long your current resources — such as employer-provided sick leave and the money in your emergency fund — would last. Also, if you have employer-sponsored disability benefits, review them to see how much income they provide and for how long.
Farm Bureau can help. For a complete analysis of your current income needs and to learn how a disability income insurance policy can help provide cash flow in case you become unable to work, contact a Farm Bureau agent today
1 The Real Risk of Disability in the United States, Milliman Inc., on behalf of the LIFE Foundation, May 2007.
2 IRS Publication 525 (2007), www.irs.gov/publications/p525; viewed 5/4/2008.