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Here are the most commonly asked questions about long term disability rates and policies. Find out what long term disability insurance is and why you need it here.

What is long term disability insurance?

Also called disability income insurance, this essential service replaces a portion of your income in the event you become injured or sick and cannot work. They will help you and your family maintain your current lifestyle, pay your bills, and stay out of debt if you suffer an illness or injury. Although the rates are usually subsidized by employers, you can also purchase individual LTD coverage on your own.

Why do I need this coverage?

Your chances of becoming disabled are surprisingly high. Depending on the source, most statistics estimate the average worker's chance of becoming disabled at 20%-30%. When this happens, the typical employee misses work for 2.5 years. Without LTD insurance, you would not receive an income during this time, which would put an inordinate financial strain on you and your family. By comparing prices, you can find affordable coverage to help your family maintain its current standard of living even if you become disabled.

What are the most common causes of disability?

The number-one cause of disability in 2007 was cancer. Cancer accounted for 12% of all claims. Complications with pregnancies and back injuries followed closely behind.

How long will I have to wait before receiving benefits?

Every policy will have a waiting period before the insured can begin collecting funds. Typical waiting periods are 60, 90, and 180 days. The longer the waiting period, the lower your premiums will be. If you have other sources of income, such as savings, you can rely on these funds until reimbursement kick in.

How long can I receive benefits for?

Again, you will be able to choose how long your policy pays benefits. The longer your policy provides them, the higher your premiums will be. Typical benefits periods are two years, five years, and until the insured reaches retirement age (age 65).

How much coverage should I buy?

Most financial experts recommend purchasing enough disability coverage to replace 60%-70% of your taxable income. These funds will be received tax-free as long as you purchased your LTD insurance with after-tax dollars. To estimate how much coverage you should purchase, you will need to consider your living expenses once you become disabled as well as other expenses, such as healthcare costs and education expenses to retrain for another career.

Read frequently asked questions about long term disability insurance