Did you know that a pair of legs were once insured for $2 million dollars? It was in the 1940’s and this astronomical amount translates to about a billion dollars in today’s money. Crazy? Maybe.
Of course, WHO the legs belonged to matters. This policy was taken out by the movie studio, Twentieth Century Fox, on the legs of the legendary movie star, Betty Grable. In this case, the executives made a calculated decision that the movie star’s legs were critical to her reputation and box office earning power and were therefore worth protecting.
How many of us protect our “legs?” How many of us protect our ability to earn an income over the next forty years?
In truth, our homes, our cars, our toys, our health, and even our lives are all no brainers to protect, but many of us forget to insure our paycheck…the thing that arguably makes all the other things possible.
Our incomes give legs to our daily lifestyles, our kids’ dreams of college, and our retirement plans.
Disability Insurance is a type of policy that insures your income or a portion of your income in the case of disability that keeps you from completing your job. According to the Council for Disability Awareness, one in four 20 year-olds today will be disabled before they retire. Without significant personal savings or disability insurance, these individuals will be sadly unprepared for the average of 36.4 months without an income due to a long-term disability. Disability Insurance can alleviate the risk that this poses to you and your family. In the case of catastrophic illness or accident, your health insurance should cover your medical treatment, but disability takes care of everything else. Disability Insurance is about peace of mind.
Maybe or maybe not. The Bureau of Labor Statistics says that less than 33% of private industry workers have long-term disability insurance. Even in professional and managerial fields, only 40% have long-term disability (The Disability Insurance Maze: How to Select and Purchase a Policy). And, while your employer may have purchased a policy on your behalf, it is important to verify that it provides long-term disability coverage. A short-term policy is better than nothing but it may leave you in a difficult position if your disability is not resolved before the benefit expires.
2. I Purchased a Policy. I’m Covered.
Having something may be better than nothing but it can also be far from good. There are important options to consider. Does the policy provide benefits if you can’t be employed in your OWN OCCUPATION or just any occupation? If you can physically work delivering pizzas, you may not be covered, even if you cannot continue your work as an attorney or electrician. Does your policy cover you until retirement benefits are available? What percentage of your income does your benefit replace? You should check your policy to make sure you can live with the coverage you have purchased.
3. I Can’t Afford Disability Insurance
It is easy to feel that we can’t afford something that we hope to never have to use. However, you want to make sure you are covered, even if that means modifying the coverage you have in other policies to make it affordable. Disability can absolutely wreck you. Medical problems contributed to 62% of bankruptcies in 2007 (Council of Disability Awareness). Let a qualified insurance broker help you through the details of these policies to find the right fit for your occupation and your budget.
Don’t forget to insure your legs. More often than not, accidents and illnesses are unpredictable and unavoidable. What we can predict is that, in the face of the unpredictable, our families will be taken care of and THAT is the whole point.