When people think about safeguarding their financial future, they typically concentrate on life insurance, health insurance and retirement savings. However, one of the least understood types to protect yourself can be the disability insurance. It protects your earnings if an accident or illness hinders you from working. This is statistically more likely to occur in your working life than death from premature causes.
Despite its importance, disability insurance is obscured by misinformation and confusion. Many workers, entrepreneurs as well as high-earning professionals are influenced by myths that cause people to overlook the benefits they require or to skip it altogether. What happens? Families are vulnerable to financial risk when their income suddenly disappears.
This article will dispel the top popular myths about disability insurance which could be costly in the long run. We’ll also explain why understanding the facts is crucial for 2025 and beyond.
Myth 1: “I Don’t Need Disability Insurance, It Won’t Happen to Me.”
The most harmful myth is the notion that disability is a rare condition. In reality, it’s not so. According to the most recent U.S. data, more than one-in-four employees will suffer from disabilities that last longer than 90 days before their retirement. They’re usually caused by conditions such as back injuries, arthritis, cancer or mental health problems.
Neglecting the possibility of a disability because you’re young, healthy and “low-risk” is like driving without insurance for your car because you believe you’ll never be involved in an accident. Although the odds might seem small, the financial implications can be life-altering if they occur.
The truth: Disability is more prevalent than you realize. If your pay is your most valuable financial asset, and for a majority of us, it is a top priority.
Myth 2: “Workers’ Compensation Will Cover Me.”
Many workers think that workers’ compensation will give them the necessary protection when they are unable to work. The reality is that workers’ compensation is only able to cover accidents or illnesses that are caused by work. This means that if you’re involved in a car crash on a weekend, have cancer, or suffer from an issue with your heart that stops you from working, it will not apply.
In fact, most of the long-term disabilities claims filed are not related to work, that’s why the sole reliance on workers’ compensation is an extremely risky gamble.
The truth: Workers’ compensation is a narrow area of coverage. Disability insurance is intended to protect against income loss, regardless of the location or manner in which your disability occurs.
Myth 3: “Social Security Disability Insurance (SSDI) Is Enough.”
Social security does provide disability benefits, but determining eligibility is notoriously difficult. Disability is defined as quite specific: you have to be unable to do any significant gainful job due to a condition that will last at least one year, or lead to death. Even so the majority of claims are rejected, and appeals may be lengthy or even years.
The average monthly SSDI payment for 2025 will be approximately $1500-$1600, which isn’t enough to cover the majority of families’ essential expenses including mortgages, retirement savings, or tuition.
The truth: SSDI can serve as a security net, however, it shouldn’t be your sole option. Private disability insurance can fill the void with broader definitions and larger amounts of benefits.
Myth 4: “My Employer’s Group Policy Is All I Need.”
Employer-sponsored disability insurance can be an excellent perk, but it can be a bit limited. A lot of group policies cover just 50% to 60% of your earnings and the benefits could be tax deductible if your employer is the one paying for the premium. Commissions, bonuses as well as incentive pay are typically not covered.
Also, coverage generally expires when you quit the business. If you move jobs, get laid off or begin a business, your security net is gone.
The truth: Employer plans are a good foundation, but supplemental private disability coverage is often necessary, especially for high-income earners who need to replace more of their income.
Myth 5: “Disability Insurance Is Too Expensive.”
Cost is among the most common objections that people make when evaluating disability insurance. Here’s a new perspective that the typical policy will cost around 13% of your income. Consider the possible loss of millions of earnings if you’re not able to continue working for a long time.
Consider it this way: You insure your car, your house and your health. Yet your income covers all of those things. The ability to safeguard it for a tiny part of your earnings is an investment that makes sense.
The truth: Disability insurance is affordable compared to the financial repercussions of losing your earnings. It is one of the most costly mistakes you’ll make if you skip.
Myth 6: “I Work in an Office, So I Don’t Really Need It.”
Another myth has it that insurance for disability is only needed for those working in physically demanding positions such as manufacturing or construction. However, there are many types of disabilities due to ailments and repetitive stress injuries or mental health problems, all of which could impact office workers.
For example, professionals working in finance, law, tech and healthcare can be affected by chronic diseases or stress-related illnesses that hinder them from completing their duties even though the work isn’t physically demanding.
The truth: No occupation is free of disabilities. Even desk jobs have risks that could affect your income and career.
Myth 7: “I Can Rely on My Savings Instead.”
Although it’s a good idea to have a savings account for emergencies, the majority of financial professionals recommend 3 to 6 months of expenses, not years. The typical long-term disability claim can last for nearly 3 years. Very few households have savings robust enough to cover that long without income.
If you do take your savings down, it means the loss of pension plans, college savings as well as future security. Disability insurance lets you keep your savings in the way they were meant to be.
The truth: Savings can help in the short-term however, disability insurance provides steady income over the long run without destroying your financial base.
Myth 8: “Only Catastrophic Disabilities Qualify.”
Many people believe that disability insurance is only available if you’re totally paralyzed or in bed. However, the policies cover a variety of ailments that hinder the person from fulfilling their job tasks, whether temporary or permanent.
For example, surgeons who suffer from hand tremors or teachers who are suffering from anxiety issues could be eligible for benefits even though they are technically able to perform different types of jobs. “Own-occupation” policies are especially beneficial for professionals since they ensure that you are able to work in your specialization.
The truth: Disability insurance isn’t only for the most extreme of cases. It’s designed to guard against any illness that stops you from earning your normal income.
Myth 9: “I’m Covered Because I Have Life Insurance.”
Disability insurance and life insurance have very different goals. Life insurance helps protect your family members in the event that you die early, while disability insurance safeguards you and your family if you’re still alive but in a position to earn a salary.
As you’re statistically more likely to be afflicted with an injury or disability than to die during your working life, not taking care of disability insurance and focusing on life insurance can leave a huge hole in your insurance plan.
The truth: Life insurance is important, but it doesn’t replace your paycheck. Disability insurance does.
Myth 10: “I’ll Buy It Later When I’m Older.”
It is expensive to delay in the field of disability insurance. The premiums are determined by health and age. The healthier and younger that you’re, the lower the coverage you will receive. If you wait until later, you could pay significant increases in premiums, or even be denied coverage entirely if you suffer from an illness.
The truth: The best time to purchase disability insurance should be when you’re young, healthy and able to pay. In the event of delay, you’ll be denied low-cost protection.
Why Believing These Myths Is Dangerous
Each of these myths downplays the economic reality of losing your earnings. If you don’t have the disability coverage, you may be facing:
- Struggle to pay mortgage, rent or other everyday expenses
- Depleting your savings and retirement savings
- More stress for your family and relationships
- Inability to maintain your life style or plan for your future
The price of believing in these myths isn’t only measured in dollars. It’s measured by peace of mind, security in finances and stability over the long term.
Final Thoughts: Protecting Your Most Valuable Asset
The ability to earn an income is the biggest financial asset. Disability insurance will ensure that, if an injury or illness halts your work, the financial stability of your life won’t go down with it.
We at Keen Coverage, believe in removing the myths and helping people, families and companies to understand their real needs for protection. Disability insurance isn’t about fear, it’s about preparing. By dispelling myths and taking action in advance to safeguard your financial future from unforeseen events.
If you’ve been putting off obtaining your disability insurance because of these myths, it’s the right time to learn the facts and consider your options. Your future self and your family will be thankful to you.