Ever since my wife stepped down from her full-time job earlier this year due to health reasons, I've been thinking more and more about the need for disability insurance.
According to Wikipedia, a disabling incidence occurs about once every second. And, another report from AHIP (America's Healthy Insurance Plans) – states that most males aged 35 face a 1 in 5 chance of being disabled for at least 90 days and a woman aged 35 will face a 1 in 3 chance (before retirement) that she will face some type of disability which will keep her away from work for at least 90 days. (No, I'm not trying to scare you here).
There are basically three ways folks can get disability insurance: buy it individually, get it from the government and/or have it covered by your employer (actually, many states require employers to provide the coverage to their employees today).
The problem with disability insurance – speaking from our own experience and research here – is that it can be somewhat complicated to qualify for and more often than not, it will only provide you with about 2/3 of your current income.
Take SSDI (Social Security Disability Insurance) for instance. Getting coverage can require that you be permanently disabled and could take a long time to be approved. You're sometimes better off trying to get unemployment compensation for a period of time than seek this benefit.
Also, in the case of employer sponsored short- or long-term disability coverage – you may only qualify if the disability is job related. You'll some how need to show the link between your disability and work. Again – coverage is only provided at about 60% your total pay.
Most disability cases are so unique and different that you'll need to seek guidance when/if this happens to you. My wife's was also a unique case that required a lot of self-advocacy and research.
The plus side of disability insurance is that it's relatively cheap compared to other insurance products. If you decide to purchase individual coverage, your rates will obviously depend on numerous factors related the extend of your policy.
I'm curious – have you ever been disabled during your employment and needed to use disability insurance? How did it work for you?