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Planning Your Future: The Eye-Opening Cost of Disability Insurance

The U.S. Bureau of Labor Statistics revealed that as of 2020, only 40 percent of civilian workers carried short-term disability insurance. Meanwhile, only 35% of civilian workers carried long-term disability insurance.

Disability insurance is essential to workers, protecting them if they are to become sick or injured. More American workers should have this coverage.

Unfortunately, not enough workers understand the cost of disability insurance. They need to know more about what they get in return than what comes out of pocket.

Here is what you should know.

What Is Disability Insurance?

If you are sick or injured, disability insurance provides you with partial income. This is so you can cover your bills.

It happens more often than you may realize. In 2021, the Social Security Administration paid disability benefits to over 9.2 million people.

That is why some employers work with a disability insurance company and offer this as a benefit. It is a way to attract and retain top talent. Plus, many workers fear what will happen if they cannot perform their job duties for a short while.

Disability Insurance Premiums

Reports show that the cost of disability insurance is between one percent and four percent of your yearly income, on average. Some disability insurance quotes consider the monthly benefit amount for your premium and ask between two percent and six percent of that.

This is a general guideline. The ultimate cost largely depends on various personal factors.

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To learn more about filing for disability, we recommend you check this link.

Disability Insurance Coverage Expenses

Many things about you will decide the cost of disability insurance. This includes your occupation, health history, and choice of policy.

Your age is a factor. The older you are, the more you will pay. If you have health problems or if you are a smoker, you will also pay more.

Women tend to file more disability claims. Therefore, disability insurance rates are usually higher for women.

Although occupation plays a factor in the rate, people with occupations with a high risk of injury will likely pay more. A higher income level means more protection, so you would have to pay more in this case.

The waiting period and benefits amount significantly influence disability insurance rates.

Disability Insurance Protects Workers

A common misconception for people is that the term “disability” means a permanent condition. It can be for conditions that are less severe and temporary. Depression, back pain, digestive disorders, and pregnancy can qualify as a disability.

When a disability is not permanent but is severe enough that you can’t do your work duties for some time, disability insurance coverage helps you cover your bills.

The True Cost of Disability Insurance

What would happen if you could not work for a short time? What happens if you have to forego a paycheck? It’s scary.

The cost of disability insurance can be deceiving. There are many factors involved, and it may seem expensive. However, it offers peace of mind for the cost.

You can sleep well at night knowing that if something happens to you, there will still be a paycheck to cover your bills.

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