Most of us rely on business income to pay our bills. If you weren’t able to work for a period of time due to an illness or injury, disability insurance steps in to help cover your needs, letting you focus on taking care of yourself.




If you’re an independent worker or running a small business, disability insurance is likely super important to your work-life world. Why? If you become sick or injured and can’t work for some time (and it’s confirmed by a doctor) disability is designed to cover up to about 60% of your paycheck or income. That’s why it’s sometimes nicknamed “paycheck protection.” Basically, disability insurance for small business owners helps make ends meet, until you get back on your feet.

Disability insurance has earned the moniker “disability income insurance” because that’s what it is. When you can’t work because of a serious illness or injury, disability insurance helps cover living expenses, like bills and groceries. Its purpose is to replace a percentage of your income. The difference between it and other health insurance plans is that disability benefits are paid directly to you.

1 in 4 people over the age of 20 will become disabled during their working lives.

U.S. Social Security Administration, Fact Sheet, 2018

It can be hard to imagine getting an illness or injury that could keep you out of work for a period of time. But, did you know that more than a quarter of people are likely to experience an illness or injury that makes it impossible to work for at least one year before they reach retirement age?

Unexpected events happen in life. Cancer and mental health issues are two common reasons for disability insurance, and both of these conditions, as well as others, could pull you away from work for months or even years. As a self-employed individual, your income depends on your ability to work. If you become disabled, you could lose your income.

Disability insurance benefits for independent contractors help keep you — and your small business — afloat so you can focus on getting better.

90% of long-term disabilities result from illnesses rather than accidents.

Council for Disability Awareness, 2018

Your insurance premium is generally based on your desired coverage and your annual salary, along with other life factors. Typically, you can expect to pay one to four percent of your income towards your insurance premium. The factors considered when calculating your insurance premium include:

  • Your salary
  • Your occupation
  • Your age
  • Your gender
  • Your health history
  • Your location
  • Your benefit amount
  • Your benefit period

When choosing your insurance plan, you should also consider planning for future expenses, such as retirement or children’s education expenses.

Disability insurance is essential, because the entire idea of unplanned injuries and illnesses is just that — unplanned and unexpected.