A lot is written about when you should purchase an individual disability policy:
- The sooner the better!
- While you are young and healthy
- While you are in medical school, dental school, veterinary school, during medical residency, dental residency, first year practicing law, etc…
So now you have your disability policy and you are continuing to pay premiums. So when is it OK to drop your policy?
- You have retired. If you are retired and are no longer working, you may no longer need disability insurance. Disability insurance is intended to cover your paycheck during your working years. If you are not bringing home a paycheck, you do not need to insure it anymore.
- You are independently wealthy. Again, if you are not dependent on your income, you do not need to insure it.
- You turn 65 and the policy expires
As long as you are dependent on your income to pay your bills, you need to make sure your income is properly insured!
Do NOT drop your individual disability insurance in the following circumstances:
- You take on a new job where they have a group policy. Even though you may have a group policy, there are still gaps. Policies tend to be more restrictive in their definition and the benefits are taxable if your employer is paying the premium. And, if you ever leave, you may not be able to take the policy with you.
- If you have a significant change in health. Once you have a diagnosis such as cancer or diabetes, you are uninsurable and you may never be able to obtain coverage!
- If you decide to take a leave of absence, work part time or start a business. Even though your income may be less, you may still pay your premiums and keep your full benefits.
For more information about when to keep or drop your individual disability insurance policy, contact Set for Life Insurance today!