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Disability Insurance Can Protect Your Income After an Injury or Illness

NASHVILLE – In recognition of May as Disability Insurance Awareness Month, the Tennessee Department of Commerce and Insurance (“T­­­­DCI”) encourages all Tennesseans to consider how disability insurance can protect their incomes in the event of illness or injury.

Disability insurance guarantees a portion of income for you and your family, if you are unable to work due to a disability.

Unfortunately, too many individuals don’t protect their income, leaving them vulnerable to the financial consequences of an illness or injury that prevents them from earning a paycheck. According to the U.S. Social Security Administration, more than one in four of today's 20-year-olds will become disabled before reaching retirement age. Without disability insurance, even those who experience a short-term illness or injury can quickly run out of money without a backup plan to replace their lost income.

“Disability insurance can provide significant benefits to policyholders at a time of great need,” said Bill Huddleston, TDCI Assistant Commissioner for Insurance. “These policies protect a policyholder by providing financial assistance that can help cover everyday living expenses including food, mortgages, or tuition, which may otherwise be difficult to afford when the policyholder loses his or her ability to earn a living through employment.”

Short- and long-term disability insurance can help working Tennesseans protect themselves in the event of an illness or injury. Short-term insurance will typically replace a portion a policyholder’s salary for three to six months. Long-term insurance will generally begin six months after the disability and can last for years or even until retirement age.

Disability insurance and other income protection insurance products can typically be obtained through employer-sponsored benefits or purchased individually.

Employers can play an important role in providing access to disability insurance for their employees. However, many individuals may also wish to purchase this type of insurance outside of their employer-sponsored plans.

TDCI offers consumers the expertise of the Consumer Insurance Services (“CIS”) Team, which educates consumers and mediates insurance-related disputes. CIS’s program covers a vast array of insurance-related issues.

Consumers who wish to learn more about disability insurance may reach out to our Consumer Insurance Services Team, by calling (615) 741-2218.

For more information about disability insurance, you can also learn more from the National Association of Insurance Commissioners’ website.

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