Why You Should Consider Independent Disability Insurance

Risk management is a crucial aspect of financial planning, aimed at safeguarding your financial future against unforeseen events. One critical element in this strategy is disability insurance, which serves as a safety net by providing income protection if you’re unable to work due to injury or illness. While it’s common for employers to offer some form of disability insurance as part of their benefits package, this employer-provided coverage might not fully address your needs. Relying solely on it could leave you exposed to financial vulnerability in the event of a long-term disability.

The primary reason to consider purchasing your own disability insurance policy, in addition to any employer-provided coverage, is the potential gap in income protection. Employer-sponsored plans often cover only a fraction of your actual income, and benefits from such plans are typically taxable if the premiums are paid by the employer. This can result in a significant shortfall in your income replacement, making it difficult to maintain your standard of living and meet your financial obligations if you’re unable to work. By securing your own policy, you can customize the coverage amount to ensure it aligns with your income needs and lifestyle, providing a more comprehensive safety net.

Another important consideration is the portability of your disability insurance. Employer-provided coverage usually ends if you leave your job, whether by choice or due to layoffs. In contrast, a personal disability insurance policy remains in effect as long as you continue to pay the premiums, offering continuous protection regardless of your employment status. Purchasing your own disability insurance policy is a proactive step toward securing your financial stability, offering peace of mind knowing that you’re protected against the income loss associated with long-term disabilities. It complements your employer’s plan by filling in coverage gaps and ensuring that you have adequate protection tailored to your circumstances. Learn more about why you should consider independent disability insurance in the video above!

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