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Short-Term Disability vs Long-Term Disability

What are Short-Term and Long-Term Disability insurance? Do I need both? These are popular questions that are asked. Disability insurance is pretty much for everyone. If you will need expenses covered in the event that you are unable to work, you will need some type of disability insurance.  Disability insurance is one of those insurance policies that are important to have especially if you do not have an emergency fund set aside to pay for living expenses. Let’s cover short-term and long-term disability a little more.

What is the difference between short-term and long-term disability insurance?

Short-term disability insurance is coverage for usually 3-6 months. This is a good policy to have if you don’t have a large enough emergency fund to cover your fixed expenses. Long-term disability will cover you for years to even decades.

How much does disability insurance provide?

Usually, insurance companies provide around 60% of your monthly income. Sometimes you can get around 70% if needed.

If I had to pick one, which one is more important?

Long-Term Disability insurance is definitely the more important policy to have. Especially, if you can have an emergency fund of 3-6 months saved that would cover you if you needed to be out of work for the short-term. Long-Term Disability is for if you won’t be able to go back to work for years. This way you will still have expenses covered. This can prevent a financial hardship if you are out of work for a long period due to serious illness or an accident.

Are Long-Term Disability and Life Insurance the same thing?

No, Long-Term Disability kicks in when a serious illness or accident happens that would not allow you to work and provide for your normal monthly expenses for years. Life Insurance takes place to provide a set amount of funds for your loved ones in the event of your death to cover expenses and funeral costs.

Where can I get disability insurance?

While some employers offer Short-Term Disability and Long-Term Disability insurance, some do not. If your employer does not offer them, you are able to get them privately. We have quite a few carriers to choose from if you would like to shop around.

Having disability insurance is important if you need to be able to pay monthly expenses if something were to happen to put you out of work. If you think your employer may offer disability insurance reach out to HR to get you covered. If not, we are happy to help you shop around for the best policy for you. We even have carriers that can cover you instantly! Make certain you are covered just in case.