Disability Insurance can literally be a life-saver, providing funds for day-to-day living when all other financial resources have run dry.
Most people don’t realize the risk of becoming disabled, permanently or temporarily, at some point in their lives. But the reality is that at age 40, your chances of becoming disabled for 90 days or more prior to age 65 is 43 percent. (Source: 2004 Field Guide, National Underwriter)
Disability funds can come from many sources, but they all could be problematic:
- Employer coverage, but for how long and how much would an employer be required to pay;
- Personal Savings, a long-term disability could erase a lifetime of savings;
- Loans, but without an income who would be prepared to loan money;
- Working Spouse or Partner, but can a spouse or partner support two people and all the monthly bills;
- Selling Investments, the disability might come at a time that is unsympathetic to any sale;
- Social Security, drawing social security comes with a number of challenging qualifications, and benefits cannot be collected until the end of the fifth month of disability;
- Friends, Family or Charity, which is never an easy conversation to have in order to secure funds.
The bottom line is that those alternative disability funds are likely come to end at some point in the event of a longer-term disability, which is where Disability Insurance comes in.