Disability Assurance is just as important as life assurance. If you become disabled and can no longer earn an income, you will need money to look after yourself and your dependants.
You have to apply for disability assurance and the company will assess the risk of you becoming disabled due to ill health or dangers at work or in our leisure time.
If you belong to a retirement fund, you probably have some disability assurance. CHECK TO CONFIRM.
Should you be injured, in general, the company you work for will continue to pay you (for between 3 and 6 months). If you are still unable to return to work, you will begin to receive your disability benefits.
Your monthly disability benefit is only part of your income (around 75%).
Because you are no longer working CHECK THAT:
You are still a member of your retirement fund.
You still have death benefits.
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Temporary Disability (click here...)
If your disability is not permanent and you are able to return to your original work or to another type of work, your disability benefits will stop or will be significantly reduced.
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Permanent Disability (click here...)
Only if you are permanently disabled and cannot do any other type of work, will the disability income continue.
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Make sure you understand what type of disability assurance you are buying. Most benefits stop after two years. The companies have done this in order to stop people from deliberately injuring themselves in order to claim benefits, and also to encourage people to return to some type of income-producing work.
You will be required to go for regular assessments to ensure that you have either recovered sufficiently to resume some sort of employment or that your disability is permanent.
Because your disability income is based on your income at the time you became disabled, inflation will soon make your disability benefits too little to live on. It is important to make some sort of plan to make up any shortfall. If your disability benefits only pay 75% of your income, you’ll need to have a plan to make up the other 25%. Your financial advisor should explain exactly what you are buying and how you are covered.
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