Total and Permanent Disability Insurance

If you suffered a life-changing injury or illness, suddenly losing your income could leave you and your family scrambling at a time that should be fully focused on your recovery. Luckily, total and permanent disability insurance is there to replace your income if you become unable to ever return to work. 

A local independent insurance agent can help you get set up with the right total disability insurance. They'll help you shop and compare total disability plans and quotes to find the best deal. But first, here's a guide to permanent disability insurance, what it covers, and when it's helpful.

What Is Total and Permanent Disability Insurance?

Total and permanent disability is a term with a long history that started as workers' compensation jargon. It was a way to distinguish serious injuries so severe that the employee would never be able to return to work (for example, total paralysis) from more temporary disabilities like a broken leg.

Today, total and permanent disability insurance covers all or part of your income if you become permanently disabled and unable to ever return to work. It can be supplemental to workers' compensation if you’re injured on or because of your job, or it can cover off-the-job situations like chronic and mental illness.

Total and permanent disablement insurance can sometimes be part of your benefits package at work. Otherwise, you can buy it yourself, often through life insurance companies. You can also choose to supplement a permanent total disability policy through your workplace with your own coverage.  

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What Does Total and Permanent Disability Insurance Cover?

Total and permanent disability insurance is designed to cover disabilities so severe that you can never return to your former job or original field of work because of them. It’s especially designed to cover disabilities that happen outside of work, for example, autoimmune illnesses.

This coverage replaces a percentage of the income you would have made at work had you been able to continue your job. The insurance company pays it out slowly, like a paycheck. It may pay the entire amount of your previous salary, but more commonly, it pays you a percentage of that salary, often between 40%-80%. 

Total and permanent disability meaning

Here are some examples of when you might qualify for total and permanent disability insurance:

Onset of a permanent and life-altering physical or mental illness, such as: 

A serious condition may mean you can still work, but in a different career or field. If it’s a lower-paying career, total and permanent disability insurance may make up the difference in income.

What's the Difference Between Total and Permanent Disability Insurance and Long-Term Disability Insurance?

Total and permanent disability insurance is very similar to long-term disability insurance, which is designed to replace a percentage of your income if you're unable to return to work due to a disability or illness for an extended period.

However, the key difference is that total and permanent disability policies are designed for people who cannot ever return to their former job or original field. Long-term disability policies, on the other hand, are for those who will eventually be able to return to work.

Long-term disability insurance can cover an individual for several years, decades, or even until retirement. The key is that long-term disability assumes the individual could eventually resume their former job duties after recovery. Permanent and total disability assumes that the individual will never recover adequately enough to resume their old job.

How Much Does Total and Permanent Disability Insurance Cost?

The cost of total and permanent disability insurance varies depending on your age and health when you buy the policy, your typical salary, and other factors. The higher your risk of disability and your salary, the higher your premiums will be. This type of insurance can cost thousands of dollars per year.

That cost may seem shocking up front, but when you consider what suddenly losing your income could mean for you and your family, especially for the rest of your life, the expense may seem more reasonable. An independent insurance agent can help you find affordable total and permanent disability insurance near you.

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Do I Need Total and Permanent Disability Insurance?

Here are some considerations to help you determine if total and permanent disability insurance is right for you:

Since there’s no way to predict whether or not you will ever become disabled, it can be frustrating to spend money on premiums when you don’t know if you’ll ever need the benefit. But for many people, total and permanent disability insurance may be worth the money. 

It can help ensure that big purchases like a home or a child’s college tuition will remain within reach even if you suddenly become seriously ill or disabled. Your independent insurance agent can also help you determine if this coverage is right for you.

How to Get Total and Permanent Disability Insurance Discounts

Here are a few ways to lower the cost of total and permanent disability insurance:

• Insure a lower percentage of your income: Instead of insuring a high percentage, like 100% or 80% of your salary, opt for just 50% or 60%. This lowers your premiums and will still provide a significant benefit.
• Buy a group policy: There can be significant downsides to buying disability insurance through work. It can leave you stuck if you become disabled while changing jobs, but it can also be cheaper and easier to be covered by a group policy, especially if you have preexisting health conditions.
• Bundle disability insurance with life insurance: Life insurance companies often sell disability insurance. If you’re also in the market for life insurance, life insurance companies may offer you a discount if you buy both policies together.

Independent insurance agents are great at finding total and permanent disability insurance discounts. They'll help apply any savings you qualify for to reduce your premiums as much as possible.

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How to Get Total and Permanent Disability Insurance Quotes

If you buy total and permanent disability insurance through work or another group policy, it’s usually just a matter of signing up. However, you may not get the most comprehensive coverage and may miss out on certain discounts.

To get total and permanent disability insurance that can meet your needs throughout your career, it’s best to contact an independent insurance agent. Before you contact them, be prepared with the following details:

Then, your independent insurance agent can help walk you through the application process. These are often quick and easy online questionnaires. They can also help you schedule a medical exam that’s as convenient as possible if one is required.

An Independent Insurance Agent Can Help You Find the Right Total and Permanent Disability Insurance

Shopping for total and permanent disability insurance can feel overwhelming, but it’s easier when you’ve got an advocate on your team. Independent insurance agents have access to multiple insurance companies, so they're free to shop and compare quotes and policy options for you to find the best deal. Best of all, an independent insurance agent can even help you file a total and permanent disability claim for benefits if you ever need them.

A little advance planning now can lead to smoother sailing down the road if you end up with a permanent disability or illness that leaves you out of work for good. That way, you can focus more on what matters most: healing, happiness, and time with the people you love.