Figure 1. A screenshot of the Disability Income Needs Calculator from IEEE. Source: IEEE
Disability and long-term care insurance provide a source of income in the event that your ability to work is interrupted. Both help you pay bills and provide income, but there are important differences. Each plan offers specific benefits that are unique to the type of insurance you obtain. IEEE offers members both types of plans.
Disability Income Insurance Plan
If you suddenly became unable to work because of an illness or accident, disability insurance can help protect your lifestyle. Without disability protection, you could lose your savings, your investments and even your home. Often, disabled people are in the prime of their working lives: In 2016, of the U.S. population with disabilities, more than half (51 percent) were people between the ages of 18 to 64, according to the 2017 Disability Statistics Annual Report (.pdf). Expenses can pile up quickly if you are unable to work. For instance, in the first year following paraplegia, living expenses average $259,531 per person, according to Disabled World. Mounting debt and late payments can ruin your credit score, and mortgage foreclosures due to disability occur 16 times as often as they do for death, reports Smart About Money.
How do you know how much money you’ll need for paycheck protection? IEEE has an easy-to-use calculator to help determine how much paycheck protection you may need. IEEE offers three plans — the Career Plan, the Five-year Plan and the Inflation Fighter — which pay monthly benefits if you become “totally disabled” (i.e., prevented by illness or injury from performing the regular duties of your usual occupation). IEEE’s plans help take off the financial pressure if you suffer an illness or injury that leaves you totally and permanently disabled.
Long-Term Care
Many people think of long-term care as solely for the elderly because it provides financial assistance if you ever need help with daily activities such as bathing, dressing and eating meals. However, younger people who have suffered from a debilitating illness or a critical injury may also have similar needs: About one in seven adults will have a disability for more than five years, according to research from the U.S. Department of Health and Human Services. In addition, the study found that the number of adults over the age of 65 that meet the HIPPA definition of disability is expected to increase from 6.3 million in 2015 to almost 15.7 million by 2065.
As an IEEE member, you can access the Long-Term Care Resources Network, a service that helps you select a plan that meets your needs. Trained associates can provide you with information about benefits and rates of different highly rated long-term care providers.
Providers offer a number of coverage and payment options. In addition to reviewing the different types of plans available, here are some questions to consider:
- How much should I expect my premium to be?
- What is a “hybrid” plan?
- What if I have a current (or past) health condition — can I still get coverage?
- Do healthy applicants receive a discount?
- Is there a discount if I get coverage for my spouse?
Everyone’s insurance needs are unique. As an IEEE member, you benefit from easy-to-use tools and services that will help you research and select the appropriate plan that will help you plan now to secure your future. Contact IEEE today for help with planning.