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3 Commonly Asked Questions About Disability Insurance

Many Americans are concerned about paying living expenses if they become disabled due to an illness or injury. In fact, 52% of adults say they would be in financial trouble if a disability kept them from working, as reported by the Council for Disability Awareness.1

For those who are forced to file bankruptcy, disability-related loss of income is often a significant factor. According to a Federal Reserve report, 77% of debtors said income loss contributed to their bankruptcy and almost half of those pointed to medical issues as a contributor.2

Employers can help their employees guard against these issues by providing disability insurance as a supplemental benefit, and by educating them about benefits of coverage. Here are a few common questions about disability insurance.

1. What does disability insurance cover?

Disability insurance provides a benefit if a covered person is certified as disabled (either partially or totally due to an illness or injury) by a health care provider and is being treated for their disability and is unable to work. The last point is important since disability insurance is intended to help replace a portion of lost income if a person cannot perform their job duties.

In fact, the benefit may be calculated as a portion of the person's income. Monthly payments are typically paid for a specified benefit period and are intended to help the person replace lost wages and continue paying bills while they are out of work.

2. Why doesn't primary health insurance cover disability-related costs?

Primary health coverage is intended to help pay certain costs associated with medical care, not to supplement or replace lost income. After health insurance pays, insured individuals may be left to pay for copays, deductibles and coinsurance. That's in addition to bills and day-to-day living expenses.

If they are unable to work and earn money to pay these expenses, their doctor may deem them to be partially or completely disabled. If the person has disability insurance, they can file a claim and begin receiving benefits for a period of time.

Pregnant woman checking her blood pressure.

3. Are pregnancy or birth-related costs covered under disability insurance?

Possibly. Depending on the coverage offered, pregnancy and/or childbirth may be included in disability coverage. To be eligible, a pregnant person must meet the definition of total disability the same as any covered injury or illness. Note that there may be a waiting period, which is a period of continuous disability that must be satisfied before benefits are paid.

For example, let's say Emily enrolls in disability insurance with a pregnancy/childbirth benefit included through her employer. A year later, Emily becomes pregnant and develops preeclampsia, a serious pregnancy-related condition. Due to the risks, Emily's doctor deems her totally disabled and assigns her to bed rest for the remaining months of her pregnancy. Unable to work, Emily files a claim and begins receiving a monthly benefit equal to 60% of her income for the benefit period, allowing Emily to get the rest she needs without facing financial hardship.

Disability Insurance from Allstate Benefits

Disability Insurance from Allstate Benefits can help if an employee becomes unable to work due to a covered sickness or off-the-job injury. If an employer would like to extend coverage for on-the-job accidents that result in disability, that may be available to be added as a rider.

Our coverage pays a monthly cash benefit, and because Disability Insurance is supplemental, it pays in addition to other coverage already in place. Employees can choose the maximum monthly benefit that meets their individual needs. Plus, premiums are affordable and conveniently payroll deducted.

We offer a variety of resources to help employees understand disability insurance, including a brochure, product video, frequently asked questions, claim example, and more. Contact an agent today to learn more about employee benefits package options for Disability Insurance or click here for a quote.

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