Posted on March 2, 2010.
Additional Disability Insurance - Filling the gaps in the coverage of the employer Protect your income
A policy of disability insurance can further reduce your risk of loss of significant income in several ways:
- Policies can be written to extend your coverage to 100% of income very affordable.
- Because you pay the premium, all benefits received by the complementary policy are tax free.
- Gaps in coverage identified by your insurance agent can be particularly close in the additional policy.
- Although coverage of the group ends when you leave your employer supplemental coverage remains with you regardless of whether you work for.
Many medium and large companies offer a group policy to its employees for a few dollars each pay period is automatically deducted from your salary.
The problem is that group policies are generally riddled with limitations and exceptions to coverage. For example:
- The group's policy to pay on average 60% of your regular income. However, because the premiums are paid mainly by your employer, most if not all benefits received are fully taxable as income, it means that your coverage of 60% while income has fallen to about 42% to $ override plan .
- disability policies in general Group CAP benefits between $ 5,000 and $ 6,000 per month, whatever your salary.If your income exceeds these limits you will find your household cash severely limited even if your policy is to pay the maximum profit.
- Read the fine print! Group policies can include exclusions or limited coverage for specific situations such as mental or nervous conditions linked. Coverage of alcohol or drug-related disabilities may be limited to the shortest 6 months or totally excluded.
False sense of security
The biggest problem with group policies is the false sense of security they provide.
"People think because they hold some money from their wages every time they are covered if they can not work." Explains APACK Rene, President of your future insurance, leader of the Nation independent disability insurance brokerage. "Only after the first disability income check sets the harsh reality, and thus, additional coverage is no longer an option."
Although life insurance is generally straightforward (benefits paid upon death), disability policies Group Get very specific with regard to the conditions and for how long the benefits will be paid.
It was only after the insured person is sick or injured and can not work, he / she finds the assumptions made about their coverage and benefits are wrong to take away are actually much less than before to .
Do not Be a First Great Finish Miserable
group disability insurance at work has its place. It is usually very cheap, and quite frankly, people do not think much about it. It is a good complement when signing up for life insurance during the annual open enrollment. But could grow your household If your income was reduced by 42%? Even if we could, why not take almost twice your home during the disability of $ 30 - $ 40 per month?
