Читать книгу Personal Finance After 50 For Dummies - Eric Tyson - Страница 44

Most folks lack long-term disability insurance. The two main reasons people don’t obtain this important type of insurance are as follows:

 Their company doesn’t offer it. Just three in ten workers are offered access to an LTD plan. Only 19 percent of those working for smaller employers — those employers with fewer than 100 employees — have access to an LTD plan. And just 6 percent of part-time workers have access to LTD insurance.

 They don’t enroll. Even among those in the minority who have access to LTD, many people don’t enroll. A common reason folks bypass coverage is that they believe their chances of disability are rare. Another perception is that only old people become disabled. Both of these perceptions are wrong.

So why should you spend money and buy LTD? The answers are simple. If you want to protect your future employment income, an LTD plan is one of the best ways to do so. Here are some reasons you should have LTD:

 Life is uncertain. You can’t know when and what type of disability you may suffer. That’s because many disabilities are caused by medical problems (arthritis, cerebral palsy, diabetes, glaucoma, multiple sclerosis, muscular dystrophy, stroke, and so on) and accidents (head injuries, spinal injury, loss of limb, and so on). Although older folks are at greater risk for more severe medical problems, plenty of younger adults suffer accidents or major medical problems leading to disability.

 Many applicants for Social Security disability benefits coverage are turned down. You can receive payments only if your disability will result in death or if you aren’t able to perform any substantial, gainful activity for more than a year. Recent studies show that only about 35 percent of applicants for Social Security disability benefits are approved.

 Even if you do qualify, your state’s disability plan and Social Security insurance programs probably won’t provide you with sufficient coverage, especially if you’re a higher income earner. State programs typically only pay benefits for one year or less, which isn’t going to cut it if you truly suffer a long-term disability that lasts for years. While one year of coverage is better than none, the premiums for such short-term coverage often are higher per dollar of benefit than through the best private insurer programs.Similarly, although Social Security disability benefits can be paid long term, remember that these payments are only intended to provide for basic subsistence living expenses. Those earning more than $40,000 per year find that less than half of their income is replaced by Social Security disability payments. As Table 2-2 shows, the higher your income, the smaller the portion of your income will be replaced by Social Security disability.

 Worker’s compensation, if you have coverage through your employer, won’t pay benefits at all if you get injured or become sick away from your job. Such narrow coverage that only pays benefits under a limited set of circumstances isn’t the comprehensive disability insurance you need.

TABLE 2-2 The Portion of Your Income Being Replaced by Social Security Disability Benefits

Annual Income	Social Security Disability Annual Benefit	Percent of Income Replaced by Social Security Disability
$20,000	$13,080	65%
$30,000	$16,280	54%
$40,000	$19,480	49%
$50,000	$22,680	45%
$75,000	$29,730	40%
$100,000	$33,480	33%
$150,000	$36,130	24%
$200,000	$36,130	18%
$400,000	$36,130	9%