Could you afford private disability insurance?

Many people are have life insurance. They buy it to protect their family from their premature death. Given all of the recurring expenses most people face, having life insurance seems like a good idea, as it would permit a family to pay off a home or cover other major expenses, at least for some period of time.

Private disability insurance is less common. This is somewhat surprising, as some actuarial tables suggest that for the average group of 20-year-olds, there is a 25 percent chance of them become disabled before they reach age 65. It's surprising, that is, until the average perosn discovers the price of one of these policies. Given how tight expenses are for most working people, the prospect of paying for a couple of multiple-thousand dollar disability insurance policies is simply unthinkable. This is why the Social Security Disability Insurance program remains important.

For the average working individual, as long as they see a FICA deduction on their paycheck, they likely are covered by SSDI, assuming the have worked the required number of quarters during the period prior to the development of a disability. This number changes with the age of the individual.

Individuals in their 30s would need 20 credits that earned in the 10 years prior to their stopping working. If they are older than age 42, they will need to have worked more quarters.

For instance, at age 46, an individual needs 24 credits, but by age 56, they would need 34 credits. This continues to increase until age 62 when they need 40 credits. Again, at any age, they will need to have earned 20 of the credits during the previous 10 years prior to when they stopped working due to their disability.

Because of this broad coverage, the majority of those who become disabled during their working lives, rely on SSD. However, the application process is demanding and complex and many individuals need to work with an attorney to assist with their application and with appeals when necessary.

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