Disability Insurance For Specific Circumstances

For Women Interested in Disability Insurance...
You should be aware that pricing for individual Own–Occupation Disability insurance is higher for women than it is for men. Great News Though! There are discount programs available with many of the insurance carriers we work with. If you have a group of 2 or more people, all whom work for the same company, you can apply for coverage under a Multi-Life Discount program in order to save on the premiums. Female applicants who participate in these programs tend to save approximately 40% on their premiums.

Unless certain participation requirements are met, Multi-Life discount programs will still require medical underwriting, so each applicant must be in good health to qualify. Although Multi-life programs are sponsored by an employer, policies are individually owned, paid for by each individual and completely portable should a person‘s work situation change.

Please Contact Us if you would like to discuss this further.

For People With Existing Medical Conditions...
You should be aware that Disability insurance is not easy to qualify for. There are many conditions that can prevent a person from being able to obtain individual Disability insurance.

In a situation where individual coverage cannot be purchased due to medical history, an alternative option is group coverage. Some insurance carriers we work with offer “guaranteed-issue” Disability insurance to groups with as few as 2 full time employees, as long as there is 100% participation. Guaranteed issue coverage means that there is no medical underwriting involved and all full time employees are eligible. Group coverage can either be paid for by an employer, an employee or both.

In addition to basic group coverage, there are also ways of providing additional coverage on a guaranteed-issue basis. In order to qualify for this, insurance companies have specific requirements in regard to the size of the group and participation.

Please Contact Us if you would like to discuss this further.

For Individuals With Employer-Provided Disability Coverage...

You should be aware that there are caps on benefit levels and that benefits received during a claim may be taxable.

If your group plan covers 60% of your salary to a maximum monthly benefit of $6,000, but you earn $13,000 per month, you are actually only being provided 46% coverage because of the $6,000 maximum benefit. In order to have 60% of your income covered, you would need to have approximately $7,800 of monthly benefit. Many people find that group benefits may not provide enough funds to cover all of their expenses in the event that they are disabled. In order to provide additional financial protection, individuals can purchase a supplemental layer of individual Short-Term Disability and Long-Term Disability insurance. For someone earning $13,000 per month with a maximum group benefit of $6,000 per month (taxable), he/she can purchase an additional monthly benefit of approximately $3,750 on an individual basis which would be payable tax-free. You must be in good health to qualify for additional individual coverage.

Even if you are not capped off by a maximum monthly benefit, you may still be eligible for additional coverage. Let‘s consider the following example: While working full-time you earn a gross income of $10,000 monthly and an after-tax income of $7,200 (assuming a 28% tax rate). If you are on disability claim, your group Long-Term Disability coverage will pay you a gross benefit of $6,000 monthly and an after-tax benefit of $4,320 (assuming a 28% tax rate). This represents 60% of your take home income. Can you cover your expenses and financial needs with a 40% reduction in income? Most people would say that this is not enough. You may be eligible to supplement your group coverage with an additional $1,500 per month of individual Disability insurance that is payable tax-free. This additional layer of coverage can increase the amount of benefit you receive to $5,820 which represents about 80% of your take home income.

Please Contact Us if you would like to discuss this further.