Short-Term Disability Insurance

• Short-term disability insurance covers all forms of disability, but only for a limited time. Usually, this type of disability insurance has a two-week waiting period, which means that you can not claim any insurance benefits for two weeks after you purchase the plan. Short-term disability insurance will cover up to 100 percent of your income, but this coverage will only last up to six months.
  
  

Long-Term Disability Insurance

• Long-term disability insurance, as the name implies, provides benefits for disabilities that will affect the insured for long periods of time. This type of insurance also covers any disability. Coverage for this form of insurance takes longer to kick in, meaning that you will not be able to claim benefits for at least a month and possibly up to six months after purchasing the package. Long term disability insurance will pay up to 70 percent of your pretax income for up to five years.
  
  

Types of Long-Term Disability Insurance

• When purchasing long-term disability insurance, bear in mind two types of this insurance exist. "Own occupation" insurance means that if you can not perform the duties of your own job, even if you can perform other duties of another job, you will receive full benefits. Insurance companies define "any occupation" insurance as a disability that bars the insured from working in any occupation for which he is qualified by education, training or experience.
  
  

Purchasing Disability Insurance

• Self-employment brings a certain degree of freedom, but also responsibilities. For example, self-employed individuals must make sure they purchase disability insurance, because no one can predict when an accident might occur. However, do not let fear or paranoia drive your decision to buy a disability insurance policy. Research your options, such as what the policy covers and how long you will receive benefits. In addition, try to find other self-employed individuals who might be interested in purchasing disability insurance. You may be able to buy group insurance with as few as five people.