It may not be noted in your Outlook calendar, but May is Disability Insurance Awareness Month. Not exactly a Hallmark occasion, the program was sponsored by Life Happens, a nonprofit organization of insurance industry professionals that, according to its website, strives “to inspire the public to take personal financial responsibility through the ownership of life insurance and related products.”
The objective is to sell insurance, certainly, but also to educate the public about the advantages, if not the necessity, of having life insurance and disability insurance. If you work with an estate planning professional, for example, the subject of life insurance will invariably come up. If you work with a wealth management professional, chances are good that disability insurance will come up.
Life insurance will help to cover funeral expenses and can be disbursed to beneficiaries without first having to go through probate. Disability insurance is wage protection insurance, and if you are working on a retirement plan, you may want to consider the risk of losing income following an injury.
Your plan could fold under the weight of an unpaid absence from work — you could be among the 50 percent of Americans who would experience financial difficulties before a month goes by. Or, you could be among the 10 percent who don’t even have to wait that long for trouble. So, the argument goes, life and disability insurance will protect you and your loved ones from some of these consequences.
The question for most of us is whether to purchase additional coverage or simply settle for the coverage our employers offer. For most working adults, life insurance is one component of the employee benefit package. When it comes to disability insurance, though, only 30 percent of private employers offer coverage.
Statistically, an American worker has a 30 percent chance of suffering a severe injury that results in a 90-day absence from the job. Even more interesting, these injuries are less likely to be from a fall or some other type of accident. Rather, back injuries, heart disease, cancer and other illnesses are behind the absences.
If you are thinking that Workers’ Compensation will cover those injuries, you may have to think twice. We’ll explain in our next post.
Source: LifeHealthPro.com, “The ethical considerations of selling disability insurance,” Brian Anderson, May 6, 2015Share