How do I pay my bills if I have an accident?

Protect yourself against costly medical expenses and the sudden loss of your income due to an illness, injury, or permanent disability.

What would happen if your paychecks suddenly stopped because you were too sick or injured to work? Your usual expenses must still be paid: food, utilities, house and car payments. Then add in things like unexpected medical costs or required in-home care and it is easy to see how your savings would quickly disappear.

Then, what if you couldn’t work for months – or years?

The truth is one in 3 working Americans will become disabled for 90 days or more before age 65. And the average disability absence is 2 1/2 years. (Commissioners Individual Disability Review)

During these times, saving for retirement would probably not be your number one financial goal. However, there is additional support available to help you and your family, as well as affordable ways you can safeguard your future with careful planning now.

Social security payments

The government provides aid for individuals with disabilities. Contact your local social security administration for additional details on beginning your social security payments prior to retirement age, due to disability. One thing to consider: Social Security benefits typically require that the disability must be at least 12 months in duration or must be deemed fatal by a registered medical professional before payments will begin.

To qualify you must be unable to engage in any type of work. And the monthly payments you will receive are typically lower than the social security payments you would receive if you work for a minimum of 20 years and retire at age 65.

Group long-term disability insurance

Your employer may offer long-term disability insurance. Many individuals rely solely on this option to prepare for a possible injury. However, you should check with your employer on the amount of coverage you would actually receive. Most group long-term disability insurance policies cover only a portion of your salary, often with a maximum cap and no coverage for missed bonuses, commissions or incentive compensation. As a result, some employees find that their monthly after tax income during a disability may decrease by 50% or more! 

In addition, group long-term disability payments are often taxable if the employer pays the premiums. You should meet with your benefits representative and discuss the impact to your salary if you were to become disabled.

Medicare supplement insurance

Medicare Supplement insurance can protect your savings if you or a family member gets sick or injured. This coverage will help cover expensive medical bills, previously not covered by Medicare insurance. Review our Medicare Supplement insurance plans by calling (800) 770-4561, Option 1.

Health savings account

A health savings account allows you to set aside money to pay for eligible healthcare expenses. Unlike flexible spending accounts, where if you do not spend it within a specified period of time, you lose your money, a health savings account allows you to roll over funds you don’t use in a year to help pay for expenses in the future. Your employer’s benefits representative can tell you if your employer offers this account and if you are eligible to participate. If not, you can establish one through a local bank, credit union, or other approved company.

Life insurance options

To prepare yourself and your family, you should also talk with your agent about the options your life insurance offers to protect your savings and your financial plan should you become disabled. 

An accelerated living benefit rider allows you to protect your loved ones by allowing you to use a portion of your life insurance death benefit while you are still living, permanently confined to a nursing home or with a diagnosed terminal condition. Your long-term care needs can be met with this policy addition.

Many policies offer a waiver of monthly deductions rider. In the event you become totally disabled, your insurance company would cease to deduct monthly expense fees from the cost of your insurance. 

Premium waiver disability rider keeps your life insurance coverage intact in the event that an accident or illness makes it impossible for you to pay your premiums. This ensures that your family will be protected from final expense burdens and can keep you and your family on track with your financial plans, despite the illness.

You can also elect to talk to your agent about taking a loan against the cash value of your life insurance policy. This option, however, will require you to repay the loan, often including interest, ultimately adding to your monthly expenses. It will also reduce the death benefit your family would receive upon your death.