First and foremost, everyone should visit this Social Security webpage that discusses disability income through Social Security. It is scary to say the least.
On occasion someone will say that they do not need an individual disability policy because they will go on SSDI if ever disabled. A visit to the webpage mentioned above will quickly change their mind.
“The Social Security Act defines disability very strictly.” The Social Security website clearly states that eligibility rules for SSDI differ from private disability insurance plans. To qualify for SSDI one must suffer a severe medical condition that has lasted or expected to last at least one year, or result in death. The medical condition must be so severe that the individual cannot perform the work they did in the past, and any other work!
“SSDI beneficiaries are more than three times as likely to die in a year as other people the same age.” Additionally, the Social Security website states that SSDI does not provide temporary or partial disability benefits. The vast majority that apply for SSDI are denied, which is why there are attorneys that specialize in SSDI, assisting those trying to work through a very complicated system. This help comes at a cost of course, usually 25%.
“Social Security disability payments are modest.” Payments average $1234 a month, right at the poverty line. Imagine proving that your disability is so severe that you can’t do any type of work, only to find out that your monthly SSDI check won’t cover your basic expenses to live.
Purchasing a private individual disability insurance policy is an important product that should be part of your insurance portfolio.