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Why should young people have disability insurance?

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While most people have more insurance than they need to protect their homes and their belongings, many people are underinsured when it comes to protecting one of their most important assets -- their ability to earn an income. That can be protected by long-term disability insurance. However, many people, particularly younger ones, don't have enough insurance to cover even half of their income should they sustain a long-term disability.

Generations X and Y, which, according to SocialMarketing.org, encompass those people born between 1966 and 1994, believe that the disability insurance they are able to get through their employers is adequate. However, in many cases, that insurance will only cover 60 percent of their income. After taxes, that percentage is less than 50. That's why it's important to read the fine print in your employer's benefits information to find out what kind of long-term disability options are offered.

When working people develop a financial plan for their future, they need a risk-management plan as well. As one financial analyst who focuses on people in Generations X and Y, if you don't protect your income, you won't have a nest egg to fall back on in your retirement years.

Many young, healthy people find it hard to envision a situation where they would be unable to work for a long period. However, unexpected illnesses and injuries can happen to anyone at any time. You want a policy that will cover enough of your income for you to be able to live on.

You also want an insurance company who will not dispute legitimate claims -- something that will only add unneeded stress during a difficult time for you and your family. Nonetheless, if you do find yourself battling with an insurance company over your claim, attorneys experienced with disability cases can help people receive the money they are rightfully due in order to support themselves and their families as they heal.

Source: The Wall Street Journal, "Why Young People Need More Disability Insurance" Ted Jenkin, Sep. 25, 2014

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