Disability income insurance provides you with income should you become sick or injured and unable to work. It helps protect against family financial catastrophe by giving you an income to meet daily expenses.

Disability income insurance comes in two major forms.

• A variety of employer-paid and government sponsored programs, generally cost-free to the recipient, covering certain categories of workers.

• Private policies (paid for by individuals) that protect income when there are no applicable employer or government programs or when those programs do not adequately meet income needs.

Most workers in the United States participate in the federal government's Social Security program. Social Security is best known for its retirement benefits, but also administers disability benefits. In January of 2010, 4.1 billion dollars in Social Security disability payments were sent to 7.7 million Americans.

Your salary and the number of years you have been covered under Social Security determine how much you can receive. In January of 2010, the average monthly payment for SSI was $499.

Here are some important points to remember:

Eligibility is based on being unable to perform any gainful employment, not just the job you were performing at the time the disability began.

You are eligible for benefits after you have been disabled for 5 months and if the disability is expected to last 12 months or to result in death. Claim processing may take up to 3 months, so file as soon as possible.

Social Security payments may be reduced by disability entitlements under other government programs. Why? Because total combined payments under Social Security, workers’ compensation, civil service, and military programs generally cannot exceed 80 percent of average predisability earnings. A government pension also may reduce Social Security disability payments.

After 24 months of benefits, recipients qualify for Medicare. If you want the medical insurance portion of Medicare, in addition to hospital coverage, you must enroll and pay a monthly premium.

To determin how much Disability Insurance you need, you first need to add up all the benefits you are entitled to under the public and private programs, along with the monthly income you could count on from other sources such as your savings. If the total approaches your required income after taxes, you can assume that, should total disability strike, you would be able to pay your day-to-day bills while recuperating. You must remember that eligibility for Social Security disability benefits is contingent upon your disability being expected to last for at least 12 months or lead to your death. If the total from employer benefits, Social Security, and other programs along with your own resources will not be close to your pre-disability, after-tax income and will not be adequate to support your family, you will want to consider buying additional disability income insurance to make up the difference.

The amount of long-term disability benefits you may receive through your employer’s group plan or your personal insurance benefits may be reduced by the amount of Social Security or other government benefits that maybe paid.

If you are your own employer, consider a group policy for you and your employees. If you are a sole practitioner, or if you work for a business that does not provide benefits under a group policy, an individual policy is a good idea. After all, if you do not receive benefits, your entire business may suffer.

Whether you are an employee or an employer, our agents can help analyze your sources of disability income, determine waiting periods for various benefits, and determine whether additional coverage would be wise. For additional information or a free consultation, we can be reached at (712) 276-1745 or tollfree at (877) 276-1745. You may also contact us by email at info@iiss.us