Life Insurance vs. Disability Insurance: Why You Need Both

Each year, thousands of workers head overseas, lured by a range of positive economic prospects and even a better quality of life. The reasons to take you and your family abroad for an expatriate life are numerous, but it’s vital to plan for, and protect yourself against, any unforeseen events.

While it’s true that most people are more likely to have life insurance than disability insurance, both are actually necessary to have sound peace of mind. These policies provide supplemental insurance and minimize gaps in coverage.

When working overseas—especially if you’re in a developing country—you never know what can happen. A car accident, a fall down some stairs or maybe you just find yourself face-to-face with someone you shouldn’t during a protest or civil unrest. All these can lead to getting injured and if you don’t have disability insurance, you and your family may suffer when this event keeps you from working and earning a paycheck.

Life insurance is just as important because if any of these situations lead to a tragic death, you’ll want to be sure that your family and loved ones are protected from further hardships and equipped financially.  

Temporary vs Permanent Disability Insurance

There are both temporary (whose benefits may last up to 10 years with a very generous policy) and permanent disability policies, and it makes sense for expats to purchase both types before going abroad. Temporary disability insurance pays part of your salary (up to 60 percent or $20,000 of your current salary whichever is lower) during periods in which you’re too sick or injured to work at your current occupation. If you are able to work at another job without the same physical demands, you can do that and still receive temporary benefits.

According to recent estimates by the Social Security Administration, more than 30 percent of all working Americans can expect to become disabled at some point in their career. Not only does this mean loss of income, but you may be faced with expensive medical bills and the need to renovate your home to accommodate the disability, like adding wheelchair ramps or a handicapped shower. Disability insurance provides a safety net for these large expenses.

Accident or Illness – Disability Ensures You Can Pay the Bills

There’s always the possibility that you pick up an illness from being in a foreign country and that can keep you out of work for weeks or even months. For example, in Africa, health risks include malaria, tuberculosis, dengue fever, and Hepatitis A and B. An expat will undoubtedly be inoculated against these diseases, but that doesn’t mean 100 percent protection. If you have disability insurance, you will be well protected.

According to the Council for Disability Awareness’s latest research, nearly 30 percent of all new long-term disability claims were caused by musculoskeletal system and connective tissue disorders, around 14 percent were nervous system related and 12.1 percent concerned cardiovascular/circulatory conditions. Another 9 percent were related to cancer.

If you suffer from any of these while living in the U.S., it’s possible that you will continue to work with the support of family and friends. However, if you’re overseas, alone and away from your loved ones, disability insurance can provide the comfort you need and let you take the time off that’s required to heal.

Anyone who works can qualify for disability insurance. From teachers to pilots to executives, no matter the risk or your income, Clements will have you covered.

Overseas Protection Available

U.S. citizens working overseas and foreign nationals outside their home country may find securing quality disability coverage difficult as many disability insurance companies have restrictions on covering expatriates in developing countries as well as paying disability claims overseas.

Clements Worldwide provides international disability coverage to protect a wide range of occupations including those working in construction, mining, oil drilling and the executives who oversee it all.

Clements also doesn’t discriminate against highly compensated executives and believes success shouldn’t limit your ability to be insured.

Clements’ high-limit disability insurance features high limits, providing coverage for up to $20,000 per month or 60% of earnings, whichever is lower. For the benefit of individuals working at international companies, there are no exclusions for war and terrorism. Additionally, Clements provides options for extended indemnity period of up to 120 consecutive months for temporary disability.

Why Life Insurance is Critical for Peace of Mind

Life is unpredictable and you can’t plan any unforeseen events. This is especially true when you’re in a foreign country and are not familiar with the laws, people and politics of a particular country. That’s why before heading off to any country, you should purchase life insurance and ensure peace of mind for your family.

If your family is dependent on your salary, life insurance is crucial because it replaces your income if you die. Life insurance protects your loved ones from financial burdens, such as a mortgage or college tuition, and keeps the family financially solvent.

The need for life insurance can go beyond just the breadwinner. In some cases, it may also make sense for a non-working spouse to be insured to help the surviving spouse with the costs of raising the children. Those with kids from previous marriages and those with children and dependent parents have even greater insurance needs.

Getting a life insurance policy is an essential step towards ensuring the future of both individuals and families. Find the right life insurance policy and review the benefits of Clements’ term life insurance program or get a quick quote

Learn More about International Life Insurance

Call us today at +1.202.872.0060 or 800.872.0067 or e-mail request@clements.com to discuss your insurance needs.