{"id":352996,"date":"2016-04-04T10:46:31","date_gmt":"2016-04-04T15:46:31","guid":{"rendered":"https:\/\/content.findlaw-admin.com\/ability-law\/injury\/accident-injury-law\/what-is-disability-insurance.html"},"modified":"2025-11-04T14:56:33","modified_gmt":"2025-11-04T19:56:33","slug":"what-is-disability-insurance","status":"publish","type":"page","link":"https:\/\/www.findlaw.com\/injury\/accident-injury-law\/what-is-disability-insurance.html","title":{"rendered":"Is Disability Insurance Worthwhile?"},"content":{"rendered":"\n
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Is Disability Insurance Worthwhile?<\/h1>\n\n
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\n By Lark Lewis, J.D.<\/a> | Legally reviewed by Katrina Wilson, Esq.<\/a>\n | Last updated\n
\n \n <\/i>\n Legally Reviewed\n <\/summary>\n\n
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This article has been written and reviewed for legal accuracy, clarity, and style by FindLaw\u2019s team of legal writers and attorneys<\/a> and in accordance with our editorial standards<\/a>.<\/em><\/p>\n\n <\/div>\n <\/details>\n\n

\n \n <\/i>\n Fact-Checked\n <\/summary>\n\n
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The last updated date refers to the last time this article was reviewed by FindLaw or one of our contributing authors<\/a>. We make every effort to keep our articles updated. For information regarding a specific legal issue affecting you, please contact an attorney in your area<\/a>.<\/em><\/p>\n\n <\/div>\n <\/details>\n<\/section>\n\n\n

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Disability insurance can be a big relief if a disability affects your income someday. Nobody can predict a future injury or medical condition. Still, you can consider your own risks and financial needs to decide whether whether buying a disability insurance<\/span> plan<\/span> is worth it<\/span>.<\/p>\n\n <\/div>\n\n\n\n

Disability can come from a car accident or serious injury on the job, such as an amputation. It can also arise from other debilitating illnesses, such as cancer or a heart attack. These conditions can make it harder, if not impossible, to continue working in your own occupation. <\/p>\n

This article discusses the types of disability insurance, the basics of disability insurance, and why you should get it. It also mentions how much disability insurance costs and how to get it. Finally, it addresses the legal issues surrounding disability insurance.<\/p>\n

If you have more questions about disability insurance, speak with a disability lawyer<\/a> near you.<\/p>\n

What Is Disability Insurance?<\/h2>\n

Disability insurance pays some or all of your salary if you become disabled and can’t work at your job. According to the Council for Disability Awareness<\/a>, at least one out of every four workers will become disabled at some point during their working career.<\/p>\n

Disability insurance can reimburse disabled workers for some of the income lost while recovering from illnesses and personal injuries. The amount of money you’d receive depends on the policy’s disability coverage.<\/p>\n

Why Get Disability Insurance?<\/h2>\n

Private disability insurance is beneficial because it can cover about 70% of your salary as a worker when a disability arises. This is true regardless of your age. Social Security disability insurance<\/a>, in contrast, only covers most workers after they reach a certain age. Social Security disability benefits are administered by the Social Security Administration (SSA). Benefits are capped at a maximum monthly payment regardless of a worker’s salary.<\/p>\n

Some workers may be covered by disability insurance through their employers. But many workers have limited coverage or no coverage at all. Workers with little or no coverage can buy private disability insurance to protect their earning power and provide for their families if they’re prevented from working due to an illness or injury.<\/p>\n

Types of Disability Insurance<\/h2>\n

Private disability insurance policies usually come in the form of either short-term disability insurance or long-term disability insurance<\/a> packages. Short-term disability insurance usually covers disabling illnesses for up to six months. Long-term disability insurance can cover much of a worker’s salary for an entire lifetime, if necessary.<\/p>\n

Many insurance companies also offer additional protections and options<\/a>. These include cost-of-living adjustments, guaranteed renewal, and refunding of some premium payments if you don’t become disabled within a specified time.<\/p>\n

Employer-Sponsored Disability Insurance<\/span><\/h3>\n

Similar to health insurance, some employers opt to sponsor a disability insurance<\/span> plan<\/span> for their employees. The main benefit of this option is paying a lower group rate<\/span>, which is usually less expensive than an individual policy. How an employer manages the group plan can affect disability income<\/span> taxes<\/a>, the policy\u2019s definition of disability<\/span>, and other details.<\/p>\n

These employer-sponsored plans aren\u2019t always available. In a few states, disability laws generally only require some employers to offer short-term disability benefits. Most states don\u2019t require employers to cover long-term disability claims<\/span>. This option is voluntary.<\/p>\n

Many employers still choose to offer disability insurance to employees. But you should carefully review the terms and costs of an employer’s policy before you enroll. In some circumstances, an individual policy might be more suitable. <\/p>\n

Individual <\/span>Disability Insurance<\/span><\/h3>\n

You may consider an individual disability policy if your employer doesn\u2019t offer one or you are self-employed<\/span>. This choice can give you peace of mind<\/span> and financial protection<\/span> if a serious injury leaves you unable to work.<\/p>\n

Disability insurance<\/span> premiums<\/span> can be higher for individual plans, but you can decide which plan is right for you and customize your coverage. Since individual plans aren\u2019t dependent on your employer, you can keep your policy between job changes.<\/p>\n

Social Security <\/span>Disability<\/span> Insurance<\/span><\/h3>\n

Unlike the two types described above, SSDI offers disability coverage<\/span> through the government. You can\u2019t purchase SSDI in the same way you can buy a policy from an insurance <\/span>provider<\/span>. Instead, your eligibility<\/a> depends on how long you\u2019ve worked and paid taxes into the Social Security system. See FindLaw\u2019s Social Security Disability<\/span> Law<\/a> guide to learn how this public disability insurance<\/span> works<\/span>.<\/p>\n

How Much Does Disability Insurance Cost?<\/h2>\n

The cost of disability insurance varies widely, depending on several factors, including:<\/p>\n