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Long-Term Care Insurance vs. Disability Insurance: What's the Difference?

Many people confuse disability insurance with long-term care insurance, but they are actually two very different types of coverage. Today we're going to clarify the difference and run through what each one does.

Disability Insurance

Disability insurance is coverage that replaces up to 60% of your income during your working years, expiring at age 65, if you should become ill or have an injury that prevents you from working for an extended period of time. You can also think of this as "paycheck insurance" since that's what you're protecting, is your income. Think about it . . . your most valuable asset isn't your house, car, or retirement account. It's your ability to make a living. If you don't have income coming in, nothing else can be paid for, and everything quickly starts to fall apart.

The chance of missing months or years of work because of an injury or illness may seem tiny, especially if you work behind a desk and don't feel that you have a "risky" occupation. But most long-term disabilities however are NOT the result of work-related injuries (which would make it a workers comp issue), which means you'd be on your own to figure out how to generate an income . . . while you're injured or sick.

You never think it's going to happen to you, but more than one in four 20 year old's will experience a disability for 90 days or more before they reach the age of 67. That's scary. One reason people shrug off the risk of disability is because their mind tends to go to worst case scenarios . . . such as spinal chord injuries leading to paralysis, or horrific car accidents that result in amputation. But the reality is that back injuries, cancer, heart attacks, diabetes, or other illnesses are the leading cause for most disability claims.

Long-Term Care Insurance

Long-term care insurance comes into play when you find yourself in a situation where you are no longer able to care for yourself and you need assistance. What triggers a long term care need is when you are unable to perform 2 or more of the 6 activities or daily living, or "ADL's". These include bathing, dressing, eating, toileting, transferring, (from a bed to a chair for example), and managing incontinence. When a doctor has determined that you will not be able to do at least two of these things for yourself for an extended period of time, you have a long-term care need. This type of insurance covers care in a variety of settings like in your home, an adult day care facility, or a skilled nursing home to name a few.

While most people utilize long-term care insurance in their senior years, it is definitely not limited to that as younger people can also suffer accidents or illnesses, or develop conditions that require long term care. Long term care is something that poses one of the largest financial threats to Americans today as 70% of people age 65 and up will need it at some point in their lives. Thanks to advances in medicine and science we are living longer than ever before. And paying for a couple of years of long term care out of pocket can obliterate what took you a lifetime to save. So it is a vital part of protecting your estate and assets.


Disability insurance covers lost wages due to an illness or accident during your working years. Long-term care insurance covers the care that you need if and when you find yourself no longer able to take care of yourself, whether that's due to illness or simply old age, and it offers coverage at virtually any point in your adult life.

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Protect the most important assets you have: your income, and the assets you've been able to save by throwing a shield of protection around them. By doing so you're protecting your family, your lifestyle, and peace of mind.

Call Tenaya Insurance Services at (925) 322-8073 today!

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