Disability Insurance
Definition
Insurance that replaces part of your income if you become unable to work due to injury or illness. Short-term covers months, long-term covers years. Typically replaces 50-70% of your income, tax-free.
Why It Matters
Most people don't plan for the real risk: not being able to work. A serious illness or injury could derail your finances for years. Disability insurance is cheaper than you think and protects your income.
Example
Earn $60,000 per year. Long-term disability insurance costs $60-120 per month but replaces $3,000 per month (60%) if you become disabled. A bad back could cost you decades of lost income. For $1,000-1,500 per year, that's excellent insurance.
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Pulsafi definitions are sourced from primary regulatory and industry references. See our methodology and data sources.