Disability insurance provides you with 45% - 60% of you normal salary on a tax-free basis if you are injured and unable to work. Your employer as part of your benefits package sometimes provides disability insurance, but this is not always the case. If disability insurance is provided by you r employer, it is likely gainful employment insurance. This type of insurance leaves the determination as to your disability in the hands of the insurance company. It tends to be the least expensive option and is typically a group plan.

If you are self-employed and you provide the only income for your household, you should consider own-occupation disability insurance to help cover your expenses. This form of insurance will provide you with compensation if you are unable to perform the occupation you were doing at the time of the injury. Under this form of insurance, if you are injured and unable to perform in your occupation, you will be considered totally disabled, even if you choose to do something else.

The most common form of personal disability insurance is known as income replacement insurance. With this type plan, you are penalized if you are totally disabled, but you decide to go back to work in any field. Also, with this type of disability insurance, the determination of your disability is made by your doctor and not by the insurance company.