Do You Need Long Term Disability Insurance?

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Long-term disability insurance is one of those financial instruments that most people should have, yet few people do. It’s designed to pay you in the event that you become so injured or ill that you can no longer work. How much you’ll get will depend on the type of policy you have (generally sixty to eighty percent of your salary), but the point of having this insurance is to guarantee you a source of income should you become unable to work.

Now, for most people, a standard disability insurance policy is fine. These policies will pay a portion of your salary, but some (usually the less expensive options) require that you work if you are at all able. For example, maybe you can no

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2 Responses to Do You Need Long Term Disability Insurance?

  1. Long term disability is fit for people with cash reserves.

    Many policies have long waiting periods before benefits begin. People who live check to check may fall hopelessly behind before payments begin. Those with a cash reserve to meet daily expenses find a long term policy best.

    Temporary disabilities are far more common that permanent conditions. Short term policies may work better for a larger portion of the population.

  2. Thomas Rockford says:

    My 2 cents worth: Having worked in insurance defense litigation for the past 8.5 years, it is my considered opinion that any money you spend on a disability insurance policy is wasted indeed. The reason you ask? Simple. You will be spending SUBSTANTIAL attorneys’ fees forcing the insurance companies to pay up on the policy. THIS I HAVE WITNESSED OVER AND OVER AND OVER AGAIN. The reason insurance companies push these policies? THEY’RE MONEY STREAMS! The insurance rep can stymie, thwart, postpone, delay, dishearten the insured, make them despair by incessant, voluminous demands for documentation and the ensuing Inquisitional demands for justifications, reasons you can’t work in some other area of your vocation, yadda-yadda-yadda. And, having seen this practice repeatedly over this mere 8.5 years, it is patently obvious that someone, almost assuredly the insurance representative, is making beaucoup bucks in stonewalling insureds into dropping their claims. DON’T BUY THESE POLICIES UNLESS YOU HAVE REALLY GOOD COUNSEL TO FORCE THE INSURANCE COMPANIES TO COME CLEAN. AND IT’S GOING TO COST YOU AT LEAST 200 ATTORNEY HOURS OF TIME AT HIS/HER GOING RATE TO MAKE YOUR CLAIM PAY OFF, NO MATTER WHAT PREMIUMS YOU HAVE SACRIFICED IN THE NAIVE BELIEF THAT INSURANCE COMPANIES HAVE ANY ETHICAL IMPETUS TO FAIR PLAY.

    That’s my take on the matter. Take it or leave it. But if you take it, you’ll save a lot more than premiums should you ever become disabled.

    Remember, insurance companies PUSH these policies for a reason, which is self-serving in each and every case. Better to buy shares of stock in the company than take out one of these nefarious policies. At least you’ll get a reasonable return on your dollar over time.

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