Protecting your income is one of the most important things you can do for yourself and your family. If you recently became injured or sick at your job and couldn’t work for a while, you will need a good option to make you feel financially safe and secure at home while recovering so you can get back to work. Unfortunately, many employees, including accountants, can’t afford to pay the everyday expenses that this scenario entails, if unable to work for a prolonged period of time. 

If you’re unable to work for a while, and you don’t have any income coming in or enough savings available, and you won’t be able to afford your expenses including mortgage, rent, utilities or other monthly expenses, then disability insurance is something that can help offset your bills.  If you’re an accountant who identifies with this scenario, you should consider getting individual disability insurance for accountants. 

Most people do everything within their power to protect their most valuable assets, properties, and families through an array of insurance policies, such as homeowners, auto, life, and health insurance. However, rarely do they even consider protecting their income stream. 

Disability insurance provides coverage that can help you cover your needs in case that you aren’t able to perform your duties at work and generate income. With that in mind, let’s discuss why you need disability insurance, what it is, and how to choose the right policy.

What is Disability Insurance?

Disability insurance for accountants is coverage that makes up for part of an accountant’s income when they cannot work due to disability or illness. This type of insurance coverage provides useful benefits that cover on average up to 60% of an accountant’s salary. 

Disability insurance includes two coverage options:

• Short-term disability insurance – covers lost income for six months or less. It’s the most common insurance coverage for accountants who have exhausted other workplace benefits like sick leave and paid time off.
• Long-term disability insurance – sometimes, disability can last longer than six months, and in such scenarios, long-term disability coverage makes more sense. This coverage makes up for a portion of your income, ranging from 50% to 70% in most cases. The policy can span over periods of just a few years or until retirement, depending on the type of coverage you opt for.

Where to Get Disability Insurance for Accountants

You have two options for getting disability insurance – you can either buy it on your own or at work, through your accountant firm. Work-based disability insurance coverage can be quite affordable and easy to purchase. However, it comes with a downside. 

Since it isn’t transferable, you may have to cancel your policy if you change jobs. There is also the fact that only about 25% of private work sector employees have the option to buy disability coverage policies.

Individual disability insurance provides a worker with more options and increased flexibility regarding policy management. Even if you change jobs, you won’t have to forfeit your policy, no matter how frequently you change companies. 

In addition, you also get the option to choose the period you want insurance in place. Your individual disability coverage premium will depend on an array of factors, including occupation, health, and age.

Reasons To Consider Getting Individual Disability Insurance for Accountants

First of all, every working human being needs individual disability insurance because they are prone to incidents and accidents. No one thinks about these things as long as they feel good and healthy. However, if you get disability insurance after being injured or sick, it might be too late. 

Anything can cause an accident, and there are simply way too many variables to consider. You could get sick on vacation or get injured in a traffic accident. Since it’s always better to come prepared for whatever may come, it’s better to think about insuring yourself against all odds. 

Aside from injuries, one of the biggest reasons workers can’t work is illness. Instead of losing your income, you can rest and recover from your injury or illness, knowing that your income is safe.

Disability Insurance Provides Coverage for Your Monthly Expenses

Think about all the monthly expenses that your lifestyle implies and that most people take for granted simply because it’s normal for them to support their lifestyle by their income. 

What happens when you’re unable to generate income? 

Your mortgage, daycare, healthcare, and other expenses tend to build up quite easily and bleed dry your budget in a matter of weeks, even days. Instead of focusing on your healing, you’ll find yourself injured or sick, with so many concerns weighing heavy on your mind. 

That’s why it’s a smart choice to have a disability insurance policy that can provide financial support and help maintain your lifestyle, family, and household, and at the same time allow you to take mental space and afford the time it takes to get better and recover from your medical challenge.

How To Know How Much Disability Insurance You Need

Getting group long-term disability coverage through your accounting firm is the best option to avoid complicated calculations. However, long-term policies may not be sufficient to cover all your monthly expenses and necessities. Most long-term disability policies cover about 60% of your income, but you have to include taxes in the equation. 

Your take-home coverage goes down to about 40–50% of your real income when you deduct taxes. Thankfully, you can also consider getting supplemental disability insurance to make up for your monthly income and keep your financial situation stable and liquid. 

The best way to easily determine how much coverage you need is to look at your monthly budget and review what could be removed as an additional cost and what is necessary. That should give you a clear picture of how much coverage you need to replace your income.

The Cost of Disability Insurance for Accountants

The cost of disability insurance coverage ranges from 1 to 3% of your standard income. However, before you decide to invest in a disability insurance policy, you need to take your medical history, other insurance policies you might have, income/job status, and health habits into consideration, as well as your monthly budget. 

All this combined should give you a clear picture of how much you’re comfortable spending.