Title: Disability Income (DI) Insurance: Overview
Headings: Disability Income (DI) Insurance
Disability Income (DI) Insurance
What is Disability Income (DI) Insurance?
Understanding Disability-Income (DI) Insurance
Key Takeaways
The Cost of Disability Income Insurance
Disability Income Insurance Waiting Period

Content: Disability income (DI) insurance provides supplementary income in the event an illness or accident results in a disability that prevents the insured from working at their regular employment. Benefits are usually paid monthly so the insured can maintain a comparable standard of living and pay recurring expenses. Understanding Disability-Income (DI) Insurance
​​​​​​​Disability income (DI) insurance is designed to replace between 45% and 65% of the insured’s gross income on a tax-free basis. Some policies include bonuses and commissions as income. The benefits are tax-free because the policyholder used after-tax dollars to pay premiums. The policy pays a benefit in the event illness or injury prevents the policyholder from earning their usual income in their occupation. Although some employer-offered plans and Worker Compensation can provide help during a disability, the quality and scope of the coverage may leave the disabled employee short of the protection they require. Many employer-offered plans are part of a suite of coverage and may not pay to the levels an employee needs to meet their expenses. Also, Worker Compensation only covers injuries as a result of employment. Self-employed individuals and small business owners must go it alone when it comes to disability income.