Disability Income Insurance

In the case of an accident where the insured is unable to work there is disability income insurance. This policy is a type of health insurance that also replaces income lost from the injury. There are three types of replacement income:

1. Employer-Paid Disability Insurance
2. Individual Disability Income Insurance Policies
3. Social Security Disability Benefits

The Employer-Paid Disability Insurance is not required in all states, but is a requirement for most. There is sick-leave time granted for short-term disability. Larger companies will offer long-term disability that includes benefits for a percentage of the insured’s salary for a specific amount of years or even for a lifetime.

Individual Disability Income is another type of replacement income. This is offered to employees for injuries or even illness’ that are a result from work, known as workers compensation. If there is an injury from an auto accident than an auto insurance policy will cover.

There is a payment issued for employees that are disabled, which is known as Social Security Disability Benefits. These benefits apply when an injury expected recovery is at the least twelve months or is severe enough to where employees can no longer work.

Disability insurance is important to have because accidents can happen anywhere and anytime. Whether the disability insurance is private or through an employer it is smart to have incase of a work related injury that causes disability for a long period of time. Employer disability benefits will have some tax added, but overall disability benefits are not taxed.