Even 3 to 5 years of benefits if you are disabled will allow you and your family to breathe a little easier while figuring out what to do. The benefits for these loan based products usually only provide a 3 to 5 year benefit, but that might be all you can afford so go with it. The lender might not always have the best premiums, so check around. 'You might also find lower price products that will cover loans and can be purchased through the lender. If you will probably want to take it if they do. Other things to look at are your employer's benefits and asking if they have long term disability coverage available. "Your budget will be your guide. Next, understand that you can only buy up to about 70% replacement of income for a benefit because in most cases the benefit will be income tax free, you will have the option of buying a benefit that pays for 1 year or longer, up to a benefit that pays to age 65.

Six months of income in savings will allow you to take a much longer elimination period for disability insurance, and this greatly reduces the premium. First, put aside money into that self insurance fund we talked about early in this article. Good disability coverage can be expensive, especially if you're in an occupation that is considered a higher risk class.

Another way of reducing premium cost is to find a policy that has benefits that will be reduced by what ever income you earn or Social Security benefits you receive. Own occupation definition policies will cost more. There are limits and further definitions associated with both of these so be sure to ask what the definition of disability is. Any occupation says you are disabled only if you can not be trained to do some type of work. Own occupation means you will be considered disabled if you can not perform the duties of the job you had prior to disability. Some disability policies have an "Own Occupation" definition versus 'Any Occupation." Many people think Social Security will pay them but, in fact, most disability claims for Social Security are denied, and if you do receive benefits, it is not usually until 18 or more months of being disabled. And without your income replaced, you will likely lose everything if you suffer a long term disability.