Judging by the growth of major shopping malls, the surge in online retailers and the brand new cars I see, the last thing we’re thinking about is disability income insurance!
We buy property insurance, car insurance, extended warranties or “product protection plans.” We sure do like to protect our stuff!.
Although it’s often a good idea to insure your valuables, there may be a huge hole in your other risk management plans.
Add up all the money you will earn over the coming years. Consider a 35 year old earning $60,000 and growing that income by five percent each year as a result of promotions and cost of living increases. By age 65, he/she will have earned a total of $3,986,331.
That’s serious money, assuming the income earner stays healthy!
I’m uncomfortable when the statistics tell us that a 35 year old has a 50% chance of being disabled for at least 90 days before age 65. The length of a disability, in this example, is at least 90 days. Many disabilities could last as long as 30 years using this example!
Real Life Disability Income Insurance Claims
I asked one insurance company for examples of disability income insurance claims being paid as at December 31, 2017. That’s when I realized that the risk is very real! For instance, a marketing manager had received $2,316,932 since 1998 due to chronic pain from a kidney disorder. A podiatrist suffering from severe traumatic brain injury since 1999 had received a total of $1,602,078. A carpenter had received $881,373 since 2001 due to Chronic Fatigue. A Registered Practical Nurse had received $607,054 since 2003 due to severe contact dermatitis. Click here to download the report showing many other samples and statistics on claims being paid. These are real people with real disabilities and none of them saw it coming. However, all of them made a plan to deal with it!
Disability income insurance is not as easy to apply for as life insurance. When the risks are so high, it is only natural that the insurance company is going to ask a lot more questions. Underwriting a disability income policy is tricky and you really should work with an experienced and qualified financial advisor.
Don’t play Russian roulette with your income. Take the steps right now to insure it.