More than a quarter of today’s 20-year-olds will become disabled before they retire.*
Consider the stats:
Over 37 million Americans are classified as disabled, about 12% of the total population.
The average long-term disability claim last 34.6 months *
65% of working Americans say they could not cover normal living expenses even for a year if their employment income was lost*
What does this mean for you and your family?
Many people think that accidents are the leading cause of disability claims, but, in reality, approximately 90% of disabilities are due to illness. Obesity, anxiety, diabetes, and high blood pressure, are all on the rise and contribute to the likelihood of a long-term disability. Unfortunately, most Americans do not have disability insurance or enough savings to cover the length of an average claim. Despite popular belief, worker’s comp covers less than 5% of illnesses and injuries, and 65% of initial Social Security Disability Insurance claim applications were denied in 2012. *
Those who do have disability insurance through work often do not understand or greatly overestimate their coverage. Many work-based disability insurance plans provide 60% of income, but are capped at some number which is less than many of the highly compensated employees’ salary. The income definitions often do not include bonuses or commissions. In addition, payouts are often taxable which means there is less to live on, and they all require a waiting period before receiving benefits.
The good news: By staying healthy and active, you can immediately reduce your chances of becoming disabled. That, however, should be only the first step. Check with your human resources representative and investigate your options. Some work policies will offer the opportunity to “buy up” with additional coverage, while others provide tax choice options that enable you to receive benefits income tax free.
Long-term disability insurance can be purchased to mitigate the risk of unfortunate surprises in your working years and fill the gaps left in work-based policies. Please review your current plan, and if it isn’t sufficient, let us help tailor a policy for you and your loved ones so you can safeguard the income flow and lifestyle you work hard to enjoy.
*Statistics taken from Council for Disability Awareness, http://www.disabilitycanhappen.org/chances_disability/