Author Topic: expanded long term disability insurance or SCAM????  (Read 3895 times)

cv

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expanded long term disability insurance or SCAM????
« on: May 03, 2013, 02:40:47 PM »
My employer currently offers this ELTD program, at $80 per month (post tax); It kicks in (catastrophic event) after you use up all PTO/extended medical leave, short term disability, etc., at 75% of salary for 6 month.  Benefits are not available until 4 consecutive years of working (i just started my 3rd year).

I am a single women in mid 30s, and am planning on working no more than 10-15 additional years, and was wondering if this $1000 dollar a year bill is worth it or should I move it over to Vanguard?

Thanks kindly for your advises and opinion(s)!!!


tooqk4u22

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Re: expanded long term disability insurance or SCAM????
« Reply #1 on: May 03, 2013, 02:55:07 PM »
Disability insurance is a good thing if you are not FI and especially if you have dependants (life insurance too).  The cost varies depending on age, location, and type of job.  1-2% of pay is probably average.

TheDude

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Re: expanded long term disability insurance or SCAM????
« Reply #2 on: May 03, 2013, 03:35:30 PM »
I'm not a great resource here as I have only done a little shopping for disability insurance. That seems like a lot to me especially post tax. Try calling around to some insurance agents and see what they can quote you. Whats the benefit of the policy? Is it just 75% for six months?

chucklesmcgee

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Re: expanded long term disability insurance or SCAM????
« Reply #3 on: May 03, 2013, 07:42:02 PM »
It's not a SCAM, but I don't think it's a wise financial decision. A lot of insurance is basically a tax for poor people. You don't have any children, so I don't see any enormous deal not having this.

TheDude

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Re: expanded long term disability insurance or SCAM????
« Reply #4 on: May 03, 2013, 09:12:53 PM »
chuck no offense but I think that is horrible advice. If you dont have any dependents you dont need life insurance. You do however need disability insurance. Disability insurance gives you options. What if you become disabled and cant work. If you don't have disability insurance you limit you options. I think disability is the a type of insurance people often overlook.

marty998

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Re: expanded long term disability insurance or SCAM????
« Reply #5 on: May 04, 2013, 08:20:26 AM »
It depends on the fine print of your policy. Most are so restrictive that it is impossible to make a claim.

It seems that 75% of salary for 6 months, only kicking in after you've used up other benefits  is not going to be worth the $10k you spend on it for the next 10 years.

As an aside, the real tragedy is that if everyone was properly insured, the premiums would be much cheaper, and you'd be more likely to stick with it.

If all the "good" risks don't take out cover because on the balance of probabilities they don't need it, the "bad" risks will never be able to afford the higher premiums necessary to fund their own claims.

Psychstache

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Re: expanded long term disability insurance or SCAM????
« Reply #6 on: May 04, 2013, 08:23:46 AM »
I think the concept is good, but I don't know about that price. I get similar coverage from my employer but my LTD costs just under $3 a month, pre-tax, and kicked in after 2 years of employment.

Might want to try and shop around on your own.