1. GOALS BUSINESS MATH© Thomson/South-WesternLesson 7.3Slide 1 7.3Disability Insurance Calculate disability insurance benefits

2. BUSINESS MATH© Thomson/South-WesternLesson 7.3Slide 2 Disability Insurance Benefits Disability insurance pays you a portion of the income you lose if you cannot work due to a health condition or an injury.

3. BUSINESS MATH© Thomson/South-WesternLesson 7.3Slide 3 Short-term Disability Insurance One form of disability insurance is short-term disability insurance. This policy pays you a portion of your income for a short period of time, such as 13–26 weeks. Usually there is a maximum amount that can be paid out per week or month. Some people choose to buy an accident policy or rely on their savings instead of buying short-term disability insurance.

4. BUSINESS MATH© Thomson/South-WesternLesson 7.3Slide 4 Long-term Disability Insurance Another form of disability insurance is long- term disability insurance. This type of policy may cover you for several years or until you reach retirement age. The longer the term of coverage, the higher the premium.

5. BUSINESS MATH© Thomson/South-WesternLesson 7.3Slide 5 Group and Individual Plans Disability insurance is usually bought through a group plan offered through your employer. You can also buy individual rather than group disability insurance, but it is usually more expensive.

6. BUSINESS MATH© Thomson/South-WesternLesson 7.3Slide 6 Social Security Disability Benefits If your job is covered by social security, you also may be eligible for disability insurance through the federal government. Your annual social security statement shows how much monthly disability benefits you are eligible to receive.

7. BUSINESS MATH© Thomson/South-WesternLesson 7.3Slide 7 Worker’s Compensation Insurance If you are injured on the job, you may be covered by worker’s compensation insurance. This insurance covers lost wages and medical expenses from on-the-job injuries. It is usually required by state governments and for work on federal contracts and paid for by the employer.

8. BUSINESS MATH© Thomson/South-WesternLesson 7.3Slide 8 Disability Insurance Benefits The benefits you receive from disability insurance depend on whether you are totally or partially disabled, how long you have worked, your wages, percent of your wages that are paid as benefits, and other factors. Also, the benefits you receive may be reduced by the benefits you receive from worker’s compensation and social security disability insurance.

9. BUSINESS MATH© Thomson/South-WesternLesson 7.3Slide 9 BUSINESS TIP The portion of your income paid by insurance is usually stated as a percentage of your income. It is called the benefits percentage.

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