Consumers who have little or no disability cover in place could face financial difficulties in the unfortunate event of disabilities that often result from accidents or illnesses.
Lee Bromfield, CEO of FNB Life, says most people who take out life cover mistakenly view disability insurance as an additional and unnecessary grudge purchase, until something tragic happens to them. Moreover, if you have a particular disorder that runs through your family and could potentially lead to some form of disability; it is all the more reason why you need this type of cover.
“Although life insurance ensures that your loved ones are taken care of financially in the event that you pass away, you also need to consider what will happen if you become disabled and have no income to take care of yourself and those who are financially dependent on you,” explains Bromfield.
The reason why consumers get it so wrong when it comes to disability cover is not being informed enough to realise the significant impact. For example, if you suddenly have a stroke, are permanently disabled and can no longer work or take care of yourself, you may find yourself financially stranded. Even if you do have cover through your employer it may not be enough.
Alternatively, if you were to experience back problems and couldn’t work for a period of six months or more you may need income to cater for the financial shortfall.
A common misconception held by consumers is that disabilities are usually work-related and would normally be covered through the Workers Compensation Fund set up by the government. The danger with this notion is that many disabilities can occur outside of work leaving you and your family uninsured.
“When considering the future well-being of your loved ones, it is important to strike the correct balance between life and disability cover, and the amount of cover needed depending on your individual needs. Taking out disability cover should not be seen as a tick box exercise,” concludes Bromfield.