Don't Assume You Can't Afford Disability Income Insurance

 

One of the biggest mistakes you can make regarding disability insurance is to assume you can't afford it or you won't qualify. Before you make that assumption, do some basic research and apply for coverage through the Knights of Columbus. The Order’s Income Armor product gives you options that can help you fit this critical protection into your risk management budget.

 

Here are two ways you can reduce your premium:

 

1. Choose a two-year or five-year maximum benefit period.

 

Depending on your age, the best option is probably a policy that pays benefits until you reach age 67. But a two-year or five-year duration benefit period would cover disabilities you might encounter in your working life.

 

2. Choose a longer elimination period.

 

An elimination period is the number of days a total disability must exist before benefits begin to accrue. Typical elimination periods are 30, 90, or 180 days. Choosing a longer elimination period lowers the policy’s premium. But be sure you have enough set aside in your contingency fund to account for the longer gap.

 

As your professional insurance agent, risk management is our specialty. Let’s talk about how to protect your income, your retirement needs, and your family's financial future.

​

"Why Your Insurance at Work May Be Insufficient"

 

Wall Street Journal (02/03/15) Piper, Mike

 

A mistake many people make with corporate benefits is to assume that the disability and life insurance coverage that they get automatically through their work is sufficient. In most cases, at least one of the two types of insurance should be supplemented. Anybody who is financially dependent upon their job for income has a need for disability insurance. And the total amount of coverage necessary is not particularly difficult to calculate: You need enough coverage to be able to continue to pay your bills if you become disabled. According to a 2010 survey from the Bureau of Labor Statistics, the average amount of employer-provided life insurance in the private sector is just 1.3-times the employee’s annual compensation. If your family depends on you for income, such amounts of life insurance will only be able to provide for your family for a brief period of time. The amount of life insurance that you need depends on several factors. For example, if you’re in your late 50s, your children are financially independent adults, and you have almost accumulated enough money to be able to retire, a modest amount of life insurance should be sufficient to provide for your spouse. In contrast, if you’re 28 years old with a mortgage, little savings, and two young children, you’re going to need quite a bit more coverage.