Disability insurance is perhaps one of the most overlooked products in the financial services industry because people often believe bad things won't happen to them. In fact, this optimism is necessary, for if we should worry about all the things that could go wrong, we wouldn't get out of bed.

Your greatest asset is your ability to earn. If that's affected, the consequences can be dire.

The reality, however, is that if you are injured or ill you can't work. You then lose your job and with it, your ability to earn. With no income, you can't make your bond payments and the least that could happen is that you lose your home.

Frequently, your medical costs are very high during this period. You may need a nurse or specialised equipment such as a wheelchair.

The odds of suffering a disability during your working life and being incapacitated for 90 days or more, are higher than your house burning down. But although only a relatively small percentage of workers have disability coverage, virtually all home-owners have insurance on their lives, homes and cars.

You're unlikely to die

Interestingly, the reason you are so likely to suffer a disability is exactly because you are so unlikely to die. The majority of people involved in road accidents survive. According to statistics from the US, the frequency of death from the four leading causes have decreased, while the frequency of disability has increased since the 1960s.

Since fatalities in road accidents seem to be the exception and not the rule, we tend to insulate ourselves from the consequences of such an accident. But the victims do not come out completely unscathed. Proposed changes to the Road Accident Fund will make it even more important that you have sufficient cover.

Many people avoid disability cover because they say it is too expensive. Annual premiums can be one to three percent of your annual salary. And that's why many people opt out.

But consider this: if it is expensive compared to life insurance then it stands to reason that the likelihood of you getting injured is much higher than dying. Therefore, the more expensive the policy, the more you need the protection.