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What is income protection insurance? | Michigan disability insurance

posted Oct 16, 2015, 8:42 AM by Jason Grubbs   [ updated Sep 14, 2016, 11:54 AM ]

Income protection is insurance designed to protect your paycheck if you are unable to work due to an injury or illness - it's also known as disability insurance.

Your most important asset is your ability to earn a living. Your income provides the means for achieving your financial goals - from buying groceries today to purchasing a home, putting kids through college, and funding your retirement.

While most people think about life insurance to protect their family in the event they make a hasty exit from this life a more likely risk is an illness or injury that sidelines you from working for an extended period of time.

According to the Council for Disability Awareness just over 1 in 4 of today's 20 year olds will suffer a disability before they retire; the average disability claim lasts more than 2 years; and 1 in 8 workers will be disabled for 5 years or longer during their working careers.

You can determine your likelihood of becoming disabled and the potential ramifications on your earnings by visiting this site.

Here are some disability facts you should be aware of:
  • 90% of disabilities are due to illness; only 10% are due to an injury.
  • 90% of disabilities occur outside the workplace - meaning they are not eligible for coverage under workers' compensation insurance.
  • Approximately 60% of applications for Social Security disability (SSDI) benefits are initially denied, and the average monthly payment for current beneficiaries is only $1,165.
How long could you make it without your paycheck?

The best way to protect your paycheck is with an individual disability insurance policy.  An individual policy is portable (you won't lose coverage if you change jobs), will typically replace up to 70% of your income, and benefits received are income-tax free.

The cost of income protection depends on your age, health, and occupation along with policy specifics including your benefit amount, how long those benefits would be provided, and how long you elect to wait before benefits would begin.  This flexibility allows you to design an income protection plan to meet your needs and budget.

Did you know?
You can determine how much paycheck protection you need
and request a quote through this website

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