One never knows when tragedy will strike. A herniated disc, household accident, car accident or any other misfortune can befall you anytime and render you incapable of ever working again. So, consider insuring your ability to work and earn a living. If you are asking yourself “Why do I need disability insurance?” consider that your ability to work is the single most important asset you have. That said, the potential value and importance of disability insurance cannot be overstated!
What is Disability Insurance?
If you are unable to work due to an injury or sickness, disability insurance (sometimes known as disability income insurance) usually replaces between 50% and 70% portion of your income. This is very important as you will have a sustainable income even when injured. The largest financial asset is likely your ability to earn an income. It is, therefore, really worth protecting. However, not all your income is replaced, the reason being you will have very little incentive to return to work.
Why Do I Need Disability Insurance?
So, why do I need disability insurance, you ask. A disability can occur anytime. If you are not financially prepared when you are hit with a disability, you will be hit with a great deal of hardship. If you are unable to teach or otherwise go to work, you will then lack a steady income. That means that your usual bills (from food to your mortgage payment!) could become a problem for you. The “why do I need disability insurance” question will become all too real if tragedy befalls you. Disability insurance can give you peace of mind and if the worst happens, at least you will have a bit of an umbrella to get you and your family through hard times.
When Do I Need Disability Insurance?
Well, if you wait until you are actually disabled, then you might be uninsurable. Obviously, you have to buy disability income insurance when you do not presently need it. It’s the only way it can help you in the future. Naturally, when you are young and healthy, disability insurance policies are most affordable. It might sound like a waste of money initially, but if something happens you will surely be thankful you prepared for the worst.
Pros of Disability Insurance Coverage
In the event that you get disabled, you can gladly receive a portion of your latest income. This helps you avoid the prospects of filing for bankruptcy or foreclosures. Secondly, you are able to have a more complete set of protection for your income with disability insurance. So, do I need disability insurance? Indeed. Additionally, you can equally get more money to spend on medications or therapies during your recovery with disability income insurance coverage.
Cons of Disability Insurance Coverage
Firstly, disability insurance takes time to go through. The waiting period can stretch up to three months. During this period, you will have to find other sources to provide for your needs. In addition, disability insurance is only paid for a limited period of months. Two to five years for long-term disability insurance. One to two years for short-term disability income insurance.
Recommended Disability Insurance Providers for Teachers
Here are two providers that specialize in disability insurance for U.S. educators – NTA Life and the NEA Income Protection® Plan. If you are in a different country, please leave a comment below and I will try to help you find some disability insurance options in your area!
At the most basic level, National Teachers Associates Life Insurance Company (“NTA Life”) offers supplemental insurance products that provide coverage which complements an individual’s primary major medical coverage or employer’s primary benefits package.
Benefit payments are paid directly to you (or the person you specify) in addition to any other insurance — including HMOs and PPOs. In most cases, these products are portable — you may take them with you should you change your job or retire — and guaranteed renewable for life.
This exclusive program is available only to NEA members who are actively employed in the field of education 15 or more hours per week—and it’s easy to apply.
Choose the size of your monthly benefit in $100 increments, up to two-thirds of your regular salary, or $6,000.
Choose Short-Term Disability (STD) or Long-Term Disability (LTD) protection. STD pays benefits up to a maximum of two years (depending on your age when benefits begin). LTD pays benefits up to age 67 or longer.
Thanks for reading and hopefully this post helps to answer your “Why do I need disability insurance?” question. If you have any comments or questions, please share them in the comments section on the bottom of the page. For more insurance and recommendations on how to save money be sure to subscribe to our newsletter!