Disability insurance protects an individual when he or she is unable to earn an income due to illness or injury. Many companies offer group policies that cover short-term and long-term disability for each employee. Short-term disability insurance may cover from 50-100% of an employee’s gross income for periods of up to 150 days, and long-term disability insurance typically covers no more than 50-60% of an employee’s gross income for periods that may range from one year to age 65. Benefits begin after an elimination period that ranges from one week to one year. Some individuals purchase supplemental or gap policies to increase benefits so that they can continue to support their families. Insurance companies differ in their costs, features, and benefits, with some offering benefit periods up to age 70. Individuals pay premiums as long as they have the policy unless they become disabled.
