Guardian Disability Insurance Brokerage

Disability Insurance and Divorce Planning
Insuring Payments Can Be Made No Matter What
by Gary Fegan

Disability and divorce are two things nobody really wants to think about or talk about. Yet, both happen all the time and need to be considered when planning for one’s financial security. Divorce families are already struggling with many issues - emotional and psychological; they should not endure an added level of concern in the event of a disability to a wage earner. There must be a plan in place to help the family in the event of a disability to the wage earner.

This is extremely important in a divorce family where one spouse is wholly dependent on the other for financial means. The wage earner must be protected from disability. There is most likely no way a disabled, divorced spouse could pay alimony, child support, etc and provide for him or herself. Quite often, the financial issues are hammered out in a divorce, but many times the disability coverage is not part of the plan. It is imperative that the need for this coverage be part of the divorce decree.

You or your ex-spouse should ensure that the policy be underwritten from a top rated carrier and has the best terms and conditions based on your or your ex-spouse’s occupation and duties. Try to secure a policy that offers a true own occupation definition of disability, which simply states that if you cannot perform the material and substantial duties of your occupation due to injury or sickness, you may be eligible for a monthly disability benefit even if you choose to work in another occupation. Also, coverage should include an inflation protection rider and a future purchase option rider. (These riders help keep pace with inflation and higher earnings over time). The inflation rider will kick in during a disability to keep up with inflation. The future purchase option rider allows you to add coverage to your policy in the future based on an increase in income. Speak with a disability insurance agent, and make sure that the agent is experienced and knows the various policies and companies that offer them to ensure that the policy you select is appropriate.

The thought of a family dealing with a divorce situation is difficult enough on you. You do not want to add to that burden by not insuring the wage earner. If you become disabled, you and your family will suffer a serious financial hardship. It is imperative that you protect your income with a quality disability policy.