A Publication of WTVP

If you're a middle-income wage earner today, you may need to review your long-term disability income protection and critical illness insurance. Long-term income protection insurance provides an important base of coverage. Critical illness helps ensure middle income individuals don't find themselves financially devastated from the impact of a life-threatening illness.

Middle-income wage earners are defined as households with an annual income between $25,000 and $100,000. This represents more than 60 million, or approximately half, of the households in the United States. Research indicates the majority of these households are underinsured. These wage earners have shown a low level of financial preparedness because such individuals tend to live paycheck to paycheck. A disability or serious illness could present a significant risk to your financial future.

One misperception is critical illness insurance is primarily a "cancer policy." Critical illness insurance typically covers a range of serious illnesses, including heart attack, stroke, major organ transplant, kidney failure, permanent paralysis, and coronary artery bypass surgery. Some types of policies also cover a wide variety of health screening tests, which may include mammography, colonoscopy, skin cancer biopsy, and pap tests.

Many individuals may also realize too late that funds from long-term income protection benefits may not fully cover all your out-of-pocket costs. Although long-term income protection insurance helps ensure a seriously ill individual will continue to have an income throughout treatment and recovery, these policies replace part of the individual's pre-disability earnings. Critical illness insurance helps bridge the coverage gap left by medical insurance and disability insurance. Such funds can help keep you financially healthy as your physical condition improves.

It's the increasing likelihood of survival that's making these coverages more important. Advances in medical technology are helping people survive once-fatal illnesses. Survivors are normally in for an extended recovery period, during which you're unable to work. For instance, only about 42 percent of the people who experience a coronary attack in a given year will die from it. For the survivors, 88 percent of heart attack patients under age 65 are able to return to their usual work, while 22 percent of men and 46 percent of women remain disabled.

These sobering facts reinforce the need for critical illness insurance as a vital component of a total income protection coverage plan. Together with the solid base provided by long-term income protection, critical illness insurance helps protect more of your income so you can focus on treatment and recovery.

Your professional insurance advisor can give you sound advice on disability income insurance and critical illness insurance. IBI