Individual Disability Income
& Long-Term Care Insurance
Income and asset protection are important components of a sound retirement strategy. Planning for disability and long-term care needs is critical to a successful financial plan, ensuring protection of income and assets for family members in the long term.
An injury or chronic illness can have a significant financial impact on individuals and families. The inability to work can cause significant strain in meeting financial obligations or maintaining lifestyles, greatly diminishing savings and derailing funds for retirement. Post-retirement, the impact of a long-term disability or chronic illness can be dramatic and significantly alter the lives of those caring for the disabled person. Disability income and long-term care insurance help lessen the impact of these life-altering events.
Disability income insurance provides income replacement, protecting future earnings. A disability can occur at any time, the probability of which increases with age. A disabling event often coincides with peak earning years, when individuals are funding their retirement goals. Social programs provide modest benefits and can be difficult to obtain. Many people who rely on their occupation to cover their living expenses choose to protect their future earnings with disability income insurance. Coverage can be obtained individually or employers can provide or sponsor programs that provide individual policies in addition to existing group long-term disability benefits. Employer-sponsored individual disability programs allow an executive to obtain more coverage with limited underwriting and at discounted premiums.
Long-Term Care (LTC) Insurance provides income for the cost of care, protecting accumulated wealth.
LTC encompasses a wide range of supportive and health services that are required when an individual suffers from a long-term disability or chronic illness, or an accident renders them physically or cognitively unable to care for themselves for an extended period. Medical insurance covers hospitalization, not assistance with activities of daily living such as getting dressed, eating, or bathing. Other social programs require assets to be exhausted before providing assistance or only provide nursing home care for a limited period after a hospitalization, not care at home where most prefer. Assistance for services helping with activities of daily living can be very costly. Many people choose to protect themselves against this risk by purchasing long-term care insurance to provide a dedicated stream of income in the event care is needed. This allows the individual to maintain their independence and their family members to supervise where and by whom care is provided, rather than provide care themselves or make decisions on how to pay for care.