Today most Americans insure their lives and material assets, like their homes, cars, etc., many overlook the need to protect their most valuable asset - the ability to earn an income. All too often, what is thought to be a well-planned insurance program - a program consisting of life insurance, annuities, and medical expense coverage - is proven completely inadequate when disability, the one risk not covered, materializes.
Fact: The odds of becoming disabled for 90 days or longer are much greater than dying during one's working years.
Disability income insurance is designed to provide a replacement income when wages are lost due to a disability. As such, it does not cover the medical expenses associated with a disability; rather, it provides the disabled insured with a guaranteed flow of periodic income payments while he or she is disabled.
Disability Defined
With one exception (partial disability), an insured must be totally disabled before benefits under a disability income policy are payable. What constitutes total disability varies from policy to policy. The insured must meet the definition set forth in his or her policy. Basically, there are two definitions: any occupation or own occupation.
Any Occupation
The any occupation definition of total disability requires the insured to be unable to perform any occupation for which he or she is reasonably suited by reason of education, training or experience to qualify for disability income benefits.
Own Occupation The own occupation definition of total disability requires that the insured be unable to work at his or her own occupation as a result of an accident or sickness.
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