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Have You Considered Buying Disability Insurance?

Updated : February 18th, 2021

It is a cherished dream for any individual to have a good career so that one can pay bills on time, buy that dream home and car and enjoy financial freedom. Living life in the fast lane might not leave us anytime to think about possible hurdles.

What if something goes horribly wrong and those paychecks stop even before you retire? All your future plans and dreams come crashing down. That’s when disability insurance (DI) comes in. It provides an income to you and your family in case you are not able to work because of an injury or illness. Disability Insurance gives you the courage to dream without thinking about financial hurdles and you can stand on your own two feet till you reach your retirement and beyond.

What Is Disability Insurance (DI)?                                disability

Disability can be defined as a physical, mental or psychological inability to fulfill your occupational duties. It can be temporary or permanent.

Your ability to earn an income is usually considered your biggest asset. Disability insurance protects the beneficiary’s income against the risk that disability will make working impossible. It includes paid sick leave, short-term disability benefits and long-term disability benefits.

Disabilities Covered By The DI

Major illnesses, injuries and the conditions which one develops with age are also considered. Here are the major categories of illnesses that are covered by the DI.

  • Musculoskeletal Systems – Under this category major dysfunction of joints and spine related issues which disables a person from working are included.
  • Special senses and speech – Loss of vision or speech related issues.
  • Respiratory system – Conditions such as chronic pulmonary insufficiency, Cystic Fibrosis, Pneumoconiosis, Bronchitis etc are included.
  • Cardiovascular system – Chronic heart failure, Ischaemic heart disease, Peripheral arterial disease etc comes under this category.
  • Digestive system – Includes Short bowel syndrome (SBS), Inflammatory bowel disease (IBD), Chronic liver disease Gastrointestinal hemorrhaging from any cause etc.
  • Genitourinary Impairments – Impairment of Renal function, Nephritic syndrome with anasarca, persistent for at least 3 months despite prescribed therapy.
  • Hematological Disorders – Chronic anemia, Sickle cell disease or one of its variants, chronic thrombocytopenia.
  • Skin Disorders – Conditions such Bullous disease and chronic infections of the skin or mucous membranes, Dermatitis etc.
  • Endocrine Disorders – Hyperglycemia, Adrenal gland disorders, chronic hyperglycemia, Diabetes and other pancreatic gland disorders etc.
  • Congenital Disorders that Affect Multiple Body Systems: Category of Impairments includes Congenital Disorders that affect multiple body systems, non-mosaic down syndrome etc.
  • Neurological – Epilepsy, Brain tumors, Parkinson Syndrome, Spinal cord or nerve root lesions due to various causes.
  • Mental Disorders – Schizophrenia, paranoid and other psychotic disorders, Intellectual disability, Anxiety-related disorders, Somatoform disorders etc.
  • Malignant Neoplastic Diseases – Category of Impairments includes Soft tissue tumors of head neck, soft tissue sarcoma, Lymphoma, Leukemia etc.
  • Immune System Disorders – Systemic lupus erythematosus, Systemic vacuities, Systemic sclerosis, Polymyositis and dermatomyositis, Immune deficiency disorders, excluding HIV infection, Inflammatory arthritis etc.

What Are The Different Types Of DI?

Based on the nature and coverage one has six kinds of insurance to choose from.

Individual Disability Insurance

This insurance is for people who are self employed or entrepreneurs. The benefits and premiums may differ depending on the need of the individual in regards to the nature of profession, risk involved, state of residence. Higher the premium wider the coverage.

Business Overhead Expense Disability Insurance

Business overhead expense disability insurance is intended to refund a business for the overhead expenses incurred in case the owner suffers a disability. This insurance can help the owner with business expenses such as rent or mortgage costs, maintenance fees and other business related expenses.

Key-Person Disability Insurance

When a key person in a business becomes disabled, this insurance can give the business owner the benefits of continuing with the business transactions that the key person has left behind. This enables the business to move forward and go on without losing revenue and profit.

High-Limit Disability Insurance

This policy entitles the insured to a 65 percent income replacement benefit regardless of income level. This disability insurance is on top of a coverage and the most sought after.

Employer-Supplied Disability Insurance

This insurance is acquired by an employer for his employee. It is important to note that this insurance is only valid when the employee is hurt or disabled while working.

National Social Insurance Programs

The Federal Insurance Contributions Act (FICA) is a United States law that requires employees to contribute a part of their earnings to fund Medicare and Social Security. Employees who have become disabled can receive this income insurance for at least one year. Income insurance payments begin on the sixth month of disability.

It is a program managed by the Social Security Administration that insures a worker in case of a mishap. Disability insurance offers income protection to individuals who become disabled for a long period of time, and as a result can no longer work during that time period. Employees, who’ve paid the Federal Insurance Contributions Act (FICA) tax for a certain amount of time, are eligible to receive the Social Security disability income insurance.

How Much Does It Cost?

Disability insurance can be purchased as an individual policy or can be acquired by an employer for the employees. The cost of the disability insurance vary based on many factors such as benefit period, age of the individual, nature of employment, income etc.

Individuals who purchase a disability income policy can expect to pay about 1 percent to 3 percent of their annual salary.
Employers generally provide short or long term group disability coverage which is deducted from an employee’s salary.

How To File A Claim?

If you have been insured by your employer under the social security scheme then you can go on to the Employment Development Department site and can file a claim online. It is the easiest, continent and secure method or you can file it through mail.

Eligibility criteria for DI

DI benefits can be paid only after you meet all of the following requirements:

  • You must be unable to work for continuous eight consecutive days.
  • You must be employed or have been actively looking for work at the time you became disabled.
  • You must have lost wages because of your disability or, if unemployed, should have been actively looking for work. You must have earned at least $300 from which SDI deductions were withheld during a previous period.
  • You should have been under medical supervision of a licensed doctor during the first eight days of your disability.
  • You must complete and mail a claim form within 49 days of the date you became disabled or you cannot avail the benefits.
  • Your doctor must certify you as disabled.

Do I Need Disability Insurance?

If you believe in having security and peace in life and have a job then yes you need to have insurance. A recent social security fact sheet states, “Just over 1 in 4 of today’s 20 year-olds will become disabled before reaching age 67.” And if disease or injury renders you disabled early in your working life, the lost wages can be worth much more than a house or a car.

Don’t go the way where life takes you, take life the way where you want to go. Let not uncertainties change your life. Get a Disability insurance and anchor your life to the safe harbours.

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  1. I had trouble getting my proof of self-employment to upload in secure file exchange and finally got it submitted by 12:06 am , 6 minutes late. What are the possibilities that they will deny it? I have received unemployment from March 2020 to some of Jan and some in Feb 2021. Most of Dec, Jan, Feb, March, & april were stopped for this proof of employment.
    Also, I see proof of Income as a 2nd issue but it is always on there. That was not on my TO DO list.
    I feel for u all on ID.ME…

    Anyone trying to reach UI, call their number, press 2 or 3 (questions abt filing a claim?) and then wait thru the message. At the end of it, u will be connected to a live person! I promise.. don’t push another button.. I’ve done it 4 times and it never failed.

    We lost our home, my ex took my child…. (kept her after a visit and called cps facilitating drama while the cops wouldn’t give her back without paperwork locked up in the court house..shut down for covid) I raised her by myself for 12 years & now she is with a violent alcoholic and parental alienating parent .. ….my dog, my 9-year sweet little best friend, was attacked, passing away 3 days later.. all in this time frame.
    But! It will all be ok. I have faith.

    Be grateful for your life and all that is in it today. What u dwell on daily will be your strength or weakness.
    Good luck to all of u.
    And thank you, Jeff, for responding out here. It is appreciated!
    Davulia S.

  2. I filed over two months ago. I have not received any information. My status says “pending resolution”. I have no way of contacting anyone. My position was eliminated at my job and I submitted the documentations online. I dont know what else I can do.

  3. I have been apply Ohio Pua unemployment since July 5th still pending issues. Upload what they ask for when ever I call says your case is in Adjudication. Very very frustrated, financially I am broke. Health issues. Waiting a long period.Don’t know what I will do ?

    1. Nafisa,

      I can understand your situation. There will be a delay considering the number of applications that are being processed. Please continue chasing the office/check your status online at regular intervals until payments normalize.

    2. Same here since Feb 2021 turned in all the documents still pending issues 3 months now. When you call they tell you to be patient. Pulling my hair out it’s so frustrating.

  4. I was receiving PUA unemployment. they made me file for a new claim in February. Now I am in adjudication even though I gave all the same information from my previous claim. Have been adjudication since February and I call and they say they will put in a ticket to have an Adjudicator call me. Nothing. I am wondering If I can go down to to Maryland Unemployment Office and demand that someone talk with me to release my claim for payment. It’s been 56 days. I read that they have a maximum of 45 days.

    1. Luis,

      Your adjudicator may be inundated with pending cases. Please continue to follow up (if you have the contact details) or consider the option of visiting an office in the vicinity if safe and feasible.

    2. t sounds just like mine only im disqualified yet actie every till sept 4th . they haven’t asked me for anything! i file then its disqualified yet im told im ok and have nothing to do bit wait for an answer? answer to what? they switched my program and all and asked me to provide proof for a claim that wa denied al eady back in 2018! deny me once and then again perhaps? lol idk

  5. My mom had unemployment in Florida. She just recently moved temporally to California with a sister since she needs assistance, and now the website is telling her she cannot do anything because she is register in another state. Can she keep filing unemployment in Florida, even if she is living and register now in another state? how is the process to change the unemployment? I tried calling and there is no answer. Thank you!

    1. Stephanie,

      Please ask your mother to consider transferring the UI benefits from FL to CA (details will be available on either of the websites). If there are benefits weeks left in the account, she will be able to claim them.

    1. Leatha,

      UI benefits are offered to claimants who lose employment involuntarily and be able to and available for work.

  6. I lived in ga in 2019 and move to florida in 2020 and work for the xmas months in nov-dec. I was told to do a combine wage claim. my question is which state do i file the claim in?

  7. I filed for pua in Ohio back in October 2020.My claim has been in ajudacatuon since 11/1/20.So 2 to 6 weeks is a total understatement! When I call.i am told to basically hurry up and wait some more.I have recently been redetermined and my claim is allowed.but I have one pending issue.How long is too long?

    1. Nicole,

      Unfortunately, nobody has an answer. There are perhaps thousands of pending applications. Please consider the option of visiting an office in the vicinity if safe and feasible.

  8. If you claim your weeks for unemployment and for the next 2 months you still have not received your money. Where can you go in volusia county to talk with a live person

      1. HI Jeff,
        I applied back in Dec 5th, 2020 and I haven’t received any correspondence, is there a local office that I can make an appt to make certain my claim is right.

        1. Adam,

          You can consider visiting an office in the vicinity if safe and feasible (details will be available on the Unemployment Office’s website).

  9. On NYS DOL website, my claim is saying current yet the information is for my old claim with 0 days remaining despite receiving 2 weeks of payments on the new claim and I was able to certify last night. I haven’t received anything; no letters or emails.

  10. I was disqualified for UI benefits for not providing an ID and other forms of identification. How do I fix this?

        1. Gary,

          You may not be eligible since unemployment insurance is only extended to those who become unemployed due to involuntary reasons.

    1. Hi Mike, I’m in NYS and was at the end of my BYE on 3/14, I was still certifying but wasn’t getting paid. I found out I had to file a new claim because my other was exhausted. I’m still waiting on approval. Maybe you have to file a new claim. I hope this helps.

  11. They say 2-6 weeks it’s more accurate to say 2-6 months; and when you call many of them are rude and unwilling to assist!

  12. someone needs to look into Sharon L. Anton gillette, wyo. or dickinson, nd she is a fraud and has done so many fraudulent things and please look into her

    1. Annette,

      Please report it to the Fraud Division of the Unemployment Office in your state. You can report on the website.

  13. I worked part time for thee years here in florida. I’m currently not working. I’m also retired and collects social security.
    My question is
    Am I qualified to file for unemployment ?

    1. Ruby,

      To be eligible, you’re required to have sufficient hours and earnings. Please use the “Benefits Calculator” available on this website.

  14. So adjudication takes 8 to 12 weeks. Oh okay, that explains why I havent received payment since July. That surely helps just like the rest of the information that you give. And by the way. What’s the NEW reason you can’t get through to the Call Center.

    1. Maria,
      I have gotten through to the call center (live agent) every time i’ve tried calling within the last 2 weeks. The number to a live agent (follow the prompts carefully) is (667)-207-6520. i have gotten through within 10 to 15 mins with each call i had made!

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