In the average football game the ball is snapped between 120 and 140 times as 250-300 pound highly trained men viciously fight to get to the ball carrier. Imagine what it must be like to be the target of eleven very large, aggressive and highly motivated defensive players that wish to throw you to the ground, ripping the ball from your hands in the process.
A football team manages the risk of injury to its players with physical fitness, doctors, trainers, and backups for each position. Who backs you up at ‘your position’ if events transpire to keep you from being at work for an extended period?[cs_blockquote border_color=”#477c3c” icon=”fa-quote-left” icon_size=”24px” icon_color=”#477c3c”]Who backs you up at your position if events transpire to keep you from being at work for an extended period?[/cs_blockquote]
‘Backing you up financially’ is the idea behind disability insurance and critical illness insurance. This type of insurance can protect you against loss of income when you are unable to earn a living due to injury or health reasons. Instead of bearing the burden of lost income alone, an insurance company can send you a portion of your wages while you recover from an injury or sickness. Most people would think it is a great strategy to use 1% to 4% of your income to protect the other 90 something.
Three distinct defensive plays
There are three distinct types of disability insurance.
Employer Coverage or Government programs
If you were injured or sick and spent some time in recovery, a short-term (1 to 2 years) disability policy would supply income to cover your financial needs until you could return to work. Accidents that happen on the job are often covered by the employer’s insurance in much the same way. But what if something happens off the job site? Ask about your coverage at work and do some research to inform yourself.
A long-term disability is different in that its scope considers that your injuries or illness will likely prevent your return to work any time soon and therefore your ability to provide for you and your family. Long term policies typically pay out a tax free monthly benefit for the time period you select. Most long-term benefit periods go up to the age of 65. So if you were to incur a serious long-term illness at the age of 35 and unable to work, you would receive monthly payments potentially to the age of 65.
Critical illness insurance pays you a lump-sum amount when diagnosed with a critical illness (CI) to help your financial needs. Those could include treatment that is not covered by work or government, taking time off work, private treatment, out-of-country treatment, or even flying in family members to help. The best way to think of critical illness is asset protection. If there is a treatment available and you know it will help, you will most likely do whatever it takes to get it. Critical illness insurance helps prevent against financial hardship.
Choosing the right plan can be confusing so it’s best to sit down with a professional, who will help you customize the defensive strategy of your financial plan.
The difference between retirement success and financial disaster
You’re probably thankful that in your daily work, unlike football, you don’t face an ‘active opponent’ who can cause you physical harm. The lack of opposition doesn’t mean, however, that work environments and even our daily lives are free of danger and the risk of physical disability.
Your retirement savings are just that and should not be your default disability policy.
Rob Ng-A-Fook can help you balance coverage and investment options with programs that you may already qualify for. Contact him today to see how you can he can help you with your defensive and offensive strategies.
Don’t leave your income and your family’s financial security to chance. It’s the opposing player coming across the field that you don’t see who will have you looking up at the trainer counting fingers. That is, if you have someone to look up at!