What are the Basics of Individual Disability Coverage?

Individual disability income insurance protects a portion of your income should you become disabled. Individuals often do not have enough disability income insurance, if they have any at all.

For a number of reasons your coverage may be insufficient. Perhaps your employer-sponsored plan only protects a percentage of your salary or your income has increased, leaving a portion of your income unprotected.

Purchasing an individual disability policy can help you secure insurance protection where none exists, or can supplement your existing coverage. To learn more about the value of this type of insurance coverage, visit www.halfapaycheck.com.

Terms of Coverage

Unlike group coverage, individual coverage is secured through an insurance provider by an individual and, although you must be employed to purchase the insurance, it is not dependent upon employment with a particular company or business.

Additionally, individual disability insurance can provide guaranteed-renewable coverage and guaranteed premiums to age 65.

Taxable Income and Benefit Limit

The tax treatment of benefits received from an individual disability policy is usually different from that of group coverage. When an individual pays the premiums on a disability policy, benefits received are not considered taxable income.

Individual disability coverage is often used to supplement group coverage up to the maximum allowed by the insurer. Often these policies include a rider that is available at an additional cost to increase the benefit amount as the individual's income increases.

Defining Disability

Individual disability contracts usually offer one of two definitions of disability: "own occupation" or "any occupation".

Own occupation definitions of disability protect you if you cannot perform the substantial and material duties of your own occupation.

Any occupation definitions protect you if you cannot perform the duties of a broader category of occupations.

Contact us to discuss your need for disability income insurance today!