No one likes to spend money on insurance. It is something that you pay for, but unlike a new shirt or a delicious meal, you never really see it or even enjoy it, for that matter. There is no instant gratification when you write a check each month for your insurance premium. As a result, I believe many people buy insurance only when they are required to do so. For example, in Florida, you have to have insurance on your car in order to renew your vehicle tags each year. And now, with “Obamacare,” you have to have health insurance or suffer a penalty.
By law, you do not need to have disability insurance. In fact, I believe many people reject purchasing disability insurance because they think that if they become disabled and unable to work, the government will take care of them. This line of thought is flawed. Although some people who are ill or injured and unable to work will qualify for Social Security disability, the level of impairment required to receive Social Security disability is very high and the benefits are very limited. Most people cannot survive on Social Security disability alone. That is why disability insurance is so important. It provides protection from the unexpected and will provide a stream of income that would otherwise be unavailable when you are disabled and unable to work.
Employers often offer disability insurance to their employees as part of the employer’s benefit program. Many employers will even contribute towards the payment of the premium. Although its advantageous if your employer does this, in my experience the disability insurance plans that are available through an employee benefit program are inferior to those available through the private market. In other words, individual disability policies are generally better than disability plans available through employment. Most disability plans available through employment have limited benefits as compared to “private” insurance policies, and they tend to have provisions that benefit the insurance companies. For example, most of the plans I have seen that were purchased through someone’s employment require the disabled claimant to apply for Social Security disability benefits and if approved, the insurance company gets an offset from what it is supposed to pay for the amount paid by Social Security disability. I rarely see this type of offset provision in “private” disability insurance policies purchased outside of employment.
Unfortunately “private” disability insurance policies often cost more than disability insurance plans offered as part of an employee benefit plan. However, like most other things in life, you get what you pay for and if you ever become disabled and unable to work, you will be glad that you spent a few extra dollars to purchase good disability insurance coverage.
For more information, contact the Law Office of The Law Office of Eric H. Luckman, P.A. today by calling (561) 867-6010 (561) 867-6010) or by completing our online contact form to schedule your free consultation.