Definition - What does Disability Insurance mean?
Disability insurance is insurance protection for individuals who become disabled and can no longer work as they did beforehand. The government offers disability insurance through the Social Security Administration. This type of insurance can provide a disabled person payments to replace a portion of their lost income. Sometimes, these payments only last for a period of time, and sometimes, they can extend for the full length of a disability.
Insuranceopedia explains Disability Insurance
Although Social Security offers disability insurance, it can also be purchased in the private sector. Unlike the former, private disability insurance requires the policyholder to pay out of pocket as it is not fund by taxes.
A serious disability can cause a person to lose their entire income. For this reason, it is helpful to plan in advance the type of disability insurance one may want to pursue, particularly for those who work in high-risk occupations.
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