Who should get long-term disability insurance?
Most working people should have some long-term disability insurance. Extended medical issues, and the bills and lost income that follow, are behind most cases of financial hardship in this country. Consider the following facts:
- Every 90 seconds someone files for bankruptcy in the wake of a serious illness. (American Journal of Medicine, August 2009)
- 3 out of 4 Americans would have trouble financially supporting themselves within 6 months of suffering a disability. (LIFE Foundation disability survey, April 2009)
We don’t like to be alarmist but facts are facts. Most of us depend on a paycheck (otherwise our days would involve more piña coladas). So income protection is necessary for most of us.
Physicians & Dentists
Physicians especially should have disability insurance. It protects their substantial investment in their education and training. It also safeguards their future income from a disability that would prevent them from working in their medical profession. Physicians and other specialized professionals who rely on physical abilities (e.g., fine motor skills for procedures) and sound emotional health (e.g., for patient care) should get long-term disability insurance with own occupation coverage.
Nurses, more so than most professionals, see the need for long-term disability insurance in their daily work. They care for patients, many of whom struggle with medical bills as well as the inability to work. And nurses, like physicians and dentists, rely on sound physical and emotional health for their work—from performing physical procedures and operating equipment to engaging with patients. long-term disability insurance with own occupation coverage protects a nurse’s ability to earn an income.
Who doesn’t need it?
The work of a stay-at-home mom or dad is valuable (and would cost a lot to replace)—upwards of $100,000 annually by some estimates. Unfortunately, stay-at-home parents aren’t eligible for long-term disability insurance. This insurance requires a documented earned income (like on a W2). For stay-at-home parents and other people who don’t have a traditional earned income, we advise building enough savings to cover the cost if you were incapacitated and had to hire someone in your place for at least 12 months.
Retirees don’t need long-term disability insurance. That’s because LTD insurance is linked to occupational disability—meaning any health condition that prevents you from working. It protects employment income in the event of a disability. That's why LTD insurance isn't necessary for retirees no longer working for an income.
Active Duty Military
Active duty members of the military are covered under Social Security if they suffer a disability. Also, private LTD policies usually exclude active duty from coverage.
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