Do I need Disability Insurance outside of my group plan is an excellent question. The answer, without looking at your policy is maybe. Here is why:
Most of the group plans I see fall into one of two categories. The first is short term disability, the second is long term disability coverage. In many cases the employer will offer both but the employee only opts into one or the other.
If you have short term DI, then my question is what happens if you are still disabled after that period which may only be up to 90 days or less?
If you have long-term DI, which kicks in after 6 months, 12 months, etc. what are you going to do before you start getting a benefit?
Last, statistically we know that people today will have 7 + jobs in there lifetime. This means, depending where you are, if you leave your job, whether voluntarily or not, these benefits do not follow you so consider getting something in place at minimum so you are not left hanging in the event of job loss. Remember, DI can only be applied for if you have a job. If you are not working, then you will not be able to get Disability Insurance. If you are unemployed, have a DI policy, get disabled, then you will still receive a benefit. Not a bad deal in this situation.
Answer those questions I asked and you will answer for yourself what you should consider doing.
Social Media Strategist, Disability Insurance Services, California
I personally don’t think anyone should settle for a group plan through their employer. An individual contract is portable and will follow you to any future position you take. If you get sick or injured while on your group plan, and one day decide to change jobs, it will be much harder to get coverage. And unlike the coverage a group plan offers, private disability insurance benefits are tax fee! With private DI, you can receive 70-80% of your take home pay, as opposed to group plans that typically offer 42% after taxes. Also, individual plans offer extra features like future increase options, partial disability or cost of living adjustments.
Agent Owner, Gilmore Insurance Services, Marysville, Washington State
Do you need private disability if I have group disability? Depends. If you have group first, individual (private) disability will be limited as most plans only allow 60-70% income replacement from all sources. Group usually covers 50-60% of income. It will also most likely be taxable income so you have to decide how long you can get by on anywhere from 35-50% of your total income.
Where individual disability would step in is to fill that income gap. This is the reason I answered "depends". It is what do you want, what the contracts actually say and what you can afford?
One thing to consider if you are new to the workplace is to get your individual disability first. You can protect 100% of your income or even greater if your individual is in place before group.
Licensed Life Agent, Life and Finance/ 50 States, New York
You may not need it if you have your own plan but the limit relies on the income adjustment for you. There is a certain percentage that the income must be adjusted to. Let Workers Comp cover you at the job for it is useful. Take out an individual disability plan that is all your own. Workers Comp is mandatory for any injury on job only while your disability policy can cover you both at work and home. I know the best companies for your situation.
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Most of the group plans I see fall into one of two categories. The first is short term disability, the second is long term disability coverage. In many cases the employer will offer both but the employee only opts into one or the other.
If you have short term DI, then my question is what happens if you are still disabled after that period which may only be up to 90 days or less?
If you have long-term DI, which kicks in after 6 months, 12 months, etc. what are you going to do before you start getting a benefit?
Last, statistically we know that people today will have 7 + jobs in there lifetime. This means, depending where you are, if you leave your job, whether voluntarily or not, these benefits do not follow you so consider getting something in place at minimum so you are not left hanging in the event of job loss. Remember, DI can only be applied for if you have a job. If you are not working, then you will not be able to get Disability Insurance. If you are unemployed, have a DI policy, get disabled, then you will still receive a benefit. Not a bad deal in this situation.
Answer those questions I asked and you will answer for yourself what you should consider doing.
Where individual disability would step in is to fill that income gap. This is the reason I answered "depends". It is what do you want, what the contracts actually say and what you can afford?
One thing to consider if you are new to the workplace is to get your individual disability first. You can protect 100% of your income or even greater if your individual is in place before group.