Most people have been sick, to the point of missing work for a few days. The good news is that most of us have paid sick days or vacation time, so missing work is no big deal. But what happens if you’re sick, and must miss work for several weeks or months? Most people do not have enough savings to miss too much time from work. Missing even a few weeks could put some people in the poor house.
The great thing about disability coverage is it protects a portion of your income when you are unable to work. It usually covers up to 60% of income, so it helps avoid financial disaster. Most employers offer short- and long-term disability coverage to fit different needs.
Short-term disability is for when you will eventually return to work. It covers your pay when an illness or injury keeps you away from work for a limited time. Coverage will usually begin from one to fourteen days after the incident that keeps you from work. Short-term disability covers most or all of your income while on leave.
Long-term disability is for when you’re on leave for an extended time. If you’re going to be away for months, then you would need long-term disability. It provides a portion of your income, not the total amount. For a work-related illness or injury, Worker’s Compensation may pay coverage.
It’s important to know that disability insurance does not pay medical bills, it’s not health insurance. But it does provide you with income to cover expenses. There is a form of disability available from social security, called Social Security Disability Insurance, but it is difficult to get and can take months for payments to start.