Working World

One-third of Americans between the ages of 35 and 65 will become injured and unable to work for 90 days or more at some point in their career, and disability insurance is an often-overlooked safety net that can provide protection. So what's a responsible adult to do? If you aren't offered disability insurance through your employer, seek coverage on the open market. Here are some questions to help find the plan that best fits your needs:

• Do you need short-term or long-term coverage? As a general rule, short-term disability coverage allows the insured person to receive compensation for two years or less after the initial injury, while long-term plans can cover lost income for an extended period of time — for as long as the insured person is alive, in some cases. On the flip side, short-term disability payments generally kick in sooner after a claim has been filed, while those with long-term coverage may have to wait 31 days or more to begin receiving payouts.

• How much can you afford to spend? For those who can afford to spend a little more on a month-to-month basis, long-term coverage is often seen as the safer — albeit, more pricey — option. Nonetheless, for anyone who is interested in disability insurance but unwilling to pay for large annual premiums, short-term coverage can still provide a valuable safety net if something were to happen that causes you to miss work for an extended period of time.

• Does your employer offer coverage? Just because your employer offers insurance coverage doesn't necessarily mean it's enough to protect you if you're unable to work for an extended period of time. If your current plan covers just 50 to 60 percent of your present income, then it may be worth supplementing that plan with an additional policy that would bridge the gap and cover up to 100 percent of your earnings if the need should arise.

• Do you have any additional risks? Insurance agents are notoriously picky about to whom they will offer disability insurance since calculating a person's risk of being injured on the job is much more difficult than estimating how long they're expected to live, as is standard with a typical life insurance policy.

Before signing up for any private disability policy, expect to be asked to go through a full health screening. Potential red flags for insurers include anyone with a history of back problems or psychiatric illness, since back injuries and depression are statistically two of the most common reasons for employees to file a disability claim.  

Stephanie Miles is a freelance writer living in New York City.