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Disability Insurance - Do You?

Disability Insurance - Do You?

Old Jan 1st 2017, 1:28 am
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Default Disability Insurance - Do You?

Insurance is life here, it seems. I have policies for life on all of the family, homeowners, auto and an additional umbrella liability policy.

The more I think about it, the more I wonder whether I should be insuring my income - my ability to work is what's keeping a roof over the family and food in the fridge. (We definitely wouldn't be able to make it on my wife's salary alone, even with a massive lifestyle downsizing).

Does anyone else have a policy for disability? What are the pros and cons?
Provided by your workplace, or did you purchase on the private market? (My workplace does not provide options to purchase a disability insurance package).

And and all advice welcome.
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Old Jan 1st 2017, 1:55 am
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Default Re: Disability Insurance - Do You?

Oddly this one was benefit at nearly every job I had, even ones without health benefits, so I always had for the most part, can't recall the cost but it wasn't much as it was subsidized by the employer.

California also has short term disability most workers get, but it doesn't provide your full income.

Last edited by Jsmth321; Jan 1st 2017 at 3:30 am. Reason: Wanted to add link to state insurance program.
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Old Jan 1st 2017, 2:29 am
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Default Re: Disability Insurance - Do You?

I believe the individual market is quite small, most such covers are group purchases.
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Old Jan 1st 2017, 2:42 am
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Default Re: Disability Insurance - Do You?

I've always had it provided through employment. Check your company benefits (unless you are self employed that is).
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Old Jan 1st 2017, 10:05 am
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Default Re: Disability Insurance - Do You?

I'm fairly sure we do take this.

My wife deals with insurance stuff, but from memory we pay $0.80 per person per month for accidental deaths and disability.

She also gets short term disability and life assurance for free for herself.
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Old Jan 1st 2017, 8:28 pm
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Default Re: Disability Insurance - Do You?

Seems like most folks get theirs through work, then.

My workplace doesn't offer this, so I'm going to do a bit of research to see what's available. Thanks all.
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Old Jan 2nd 2017, 1:52 am
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Default Re: Disability Insurance - Do You?

Yes we have it - but then I used to work for a disability insurance company so I'm pretty well-informed about it.

I have several friends my age who've needed it (one had a year off work after a stroke, another didn't buy short term so has gone the GoFundMe route till his long term disability kicks in).

IMO you should always take it if it's offered through work - both short term and long term disability. Buy up if necessary, to get a good percentage of your salary. It's usually pretty cheap through work.

However my husband's company only covers up to about 30% of his salary, and we can't afford to live on that, so we shopped privately. It's tough to find individual policies. I think we're with Omaha Mutual, and it's really expensive, but we still shell out for it. You'll have to fill in extensive medical forms and they'll check it all with your doctor, and may exclude specific pre-existing conditions.

If you find other companies offering individual policies that you can buy outside of work I'd be interested to know.
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Old Jan 2nd 2017, 2:01 am
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Default Re: Disability Insurance - Do You?

Originally Posted by tom169 View Post
I'm fairly sure we do take this.

My wife deals with insurance stuff, but from memory we pay $0.80 per person per month for accidental deaths and disability. .....
That would be insurance that pays out a lump sum, I think. Mrs and I get that through work and the cost is peanuts.

Separately we are also offered "long term disability" insurance, which provides long term income if we cannot work. The details are interesting in that it is effectively a top-up policy to Social Security disability because in order to claim on the long term disability insurance policy you are required to have claimed SS disability first. IIRC it costs me around $18/mth, and Mrs P about $12, which seems like a pretty good deal.
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Old Jan 2nd 2017, 4:38 pm
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Default Re: Disability Insurance - Do You?

I get this through work. I get 60% salary long term disability insurance paid for by work, but have an option to top it up to 66% salary.
The other issue I have difficulty quantifying is if my wife becomes seriously ill, how much would childcare cost, and long term care cost for my wife?
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Old Jan 3rd 2017, 12:40 am
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Default Re: Disability Insurance - Do You?

I've always taken short and long term. Short is more expensive but still not a lot. My current employer takes it after taxes so the payout is tax free so the 60% gets quite close to normal after tax pay. Every other company took it before tax which saves you a little tax but if you use it you end up getting a pretty low amount compared to what you normally make.
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