Disability insurance is often overlooked or provided as a benefit through your employer.
Usually it only covers a minimal amount of your income. (50%or less)
There are many types of Disability Insurance including Short and Long Term,
Overhead Expense, Key Employee, Accident and or Illness including Hospital Indemnity and Cancer policies.
They are all designed to pay the bills when you cannot. And are one of the real reasons why people who suffered a major accident or illness have gone bankrupt! It is because of the double whammy effect. Not only have they seen their household income get cut most of the time in half, but they have also see an increase in their cost of living because of the medical expenses.
Disability insurance is also one of the first things that people cut back on in tough times, the thinking is that they are young ( under 50 ) and can get it later when their finances improve. As with all insurance it is age related the younger you are the cheaper it is. And it is a premium stable product meaning that unless the insurance company you are with raises its rates for everyone with a policy, your monthly premium like life insurance stays the same amount for the length of the policy.
The new policies available include Return Of Premium, which if you never make a claim you get a large portion of your premium back.
The amount of coverage has increased as well with insurance companies allowing you to protect a higher % of your income.(as much as 90% depending on your occupation)