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The standard in the US is that this is a different type of insurance (disability insurance) and it's often sold in parallel with life insurance.

Disability benefits can also (often) become available in this situation, meaning that this is one of the only situations in which the fed will actually give you money (most other benefits are paid out by the state).

Not saying that this is a good situation, just clearing up some misconceptions.

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Specifically, there are both short-term and long-term disability insurances. Both pay some percentage of your base pay (often 60%-80%, or even 100% for short-term) at the time of the qualifying event. Short-term kicks in first, but eventually runs out and the long-term insurance kicks in. Long-term insurance often covers the individual to retirement age.

Take it from me, you really want to make sure you've got both, because shit happens.

Noted spastic blabbermouth Jim Cramer makes a point of this in his books. He more or less calls disability insurance the most important financial product that people can buy.

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