What is Short Term Disability?

    If you were to become sick or disabled tomorrow and were unable to work for two or three months, would you have
    enough savings to cover your living expenses during that time? If you don't, short term disability insurance would be an
    invaluable resource as you recover so you can get back to work.

    According to the American Council of Life Insurers, nearly one-third of all Americans will suffer a serious disability
    between the ages of 35 and 65. Statistics like that make should make short-term disability insurance a vital piece of your
    overall financial plan.

    Short term disability (STD) pays a percentage of your salary if you become temporarily disabled, meaning that you are
    not able to work for a short period of time due to sickness or injury (excluding on-the-job injuries, which are covered by
    workers compensation insurance). A typical STD policy provides you with a weekly portion of your salary, usually 50, 60,
    or 66 2/3 percent for 13 to 26 weeks. Most STD policies have a "cap," meaning you receive a maximum benefit amount
    per month.


    What is Long Term Disability?

    Becoming disabled can have devastating financial implications by stripping you of your ability to make a living. While some
    people can get by without working for a few months by tapping into their savings, few people can afford to stop working
    altogether for an extended period of time.

    That's where LTD insurance can help you. LTD policies provide you with income for a long period of time, such as two
    years, five years, or until you retire. Most people who have LTD insurance get it through their employers, although you
    can buy individual LTD insurance on your own.

    What to look for in an individual long term disability insurance policy

    Definition of disability. Some policies pay benefits only if you are unable to perform the duties of your normal occupation,
    while others will pay only if you cannot work in any job at all.

    Payment trigger date. Some policies will allow you to decide when the payments begin. You can choose a waiting period
    at the time of your application.

    Extent of disability. Some policies require that you be totally disabled before payments begin. Other policies pay out for
    partial disability for a limited time, but most often only if the partial disability follows a period of total disability for the
    same cause.

    "Residual" benefits. Residual benefits can help make up the difference in your income if you are able to work, but are
    limited in your responsibilities due to your disability.

    Presumptive disability. Some policies will pay benefits if you are still able to work but still have loss of sight, speech,
    hearing, or use of limbs.

    When payments begin. You can choose to begin receiving disability payments anywhere from 31 days to the first six
    months. The longer you wait for a payment start date, the less your premiums will be.

    Length of coverage. Generally, coverage will pay you for two years, five years, or until you turn 65. The longer you
    receive payments, the more your premium will be.

    Keeping pace with inflation. You can purchase a cost-of-living adjustment (COLA) to add to your basic disability
    insurance policy. This provision generally increases payouts by 4 to 10 percent each year.

    Waiver of premium. Most policies contain a "waiver of premium" provision so that you do not have to pay premiums if
    you are disabled for 90 days or longer.
      
    LTD picks up where short term disability (STD) leaves off. Once your STD benefits expire (generally after three to six
    months), the LTD policy pays you a percentage of your salary, usually 50, 60, or 66 2/3 percent. You then receive
    benefits until you reach age 65.
TOUBIN INSURANCE AGENCY, Inc.
7410 Blanco Rd. Suite 385
San Antonio, TX 78216
210.340.2293
210.340.2357 (fax)
info@toubininsurance.com