What is Disability Income Insurance?
Disability Income Insurance (also called “income protection”) insures the employee’s earned income against potential disabilities, accidents or emergencies that would prevent the person from doing their job and earning an income. It includes long-term disability, short-term disability and sick leave.
It began with the railroads and first was called “accident insurance.” Now it often is used by the self-employed to protect against being unable to work. Premiums vary but generally are higher for those policies that pay faster, cover longer periods of time or have a broader definition of the disability. Now online calculators can help people determine the level and cost of the insurance coverage they need.