Disability Survey

Consumers Failing to Understand Risks of Ignoring Disability Insurance During Tough Economic Times

Assurant Employee Benefits recently commissioned a survey* to help in evaluating consumers’ concerns about losing dental, life and disability insurance coverage in the event of a job loss or change.  The survey reports that, while most American workers are still not covered by disability insurance, nearly half (47%) are confident they would have adequate insurance if they suffered a disability, injury or illness…even if they were facing a negative job change.

The survey findings suggest that while not likely to drop or reduce insurance options as a cost saving measure, Americans aren’t as concerned about losing insurance benefits (7%) as they are about more immediate matters, like paying the rent or mortgage (51%). 

“The thought of losing a steady paycheck is scary.  It makes sense that people immediately worry about how they’ll continue to cover expenses and care for their families, “ said John Roberts, president and CEO of Assurant Employee Benefits.  “Unfortunately, forgoing or letting go of disability insurance could take the situation from bad to devastating.  One third of all Americans between the ages of 35 and 65 will become disabled for more than 90 days, and without insurance they may risk bankruptcy, foreclosure and other serious financial damage.”

The survey also showed that consumers are more concerned about unforeseen medical emergencies or accidents (25%) than losing their disability insurance (7%).  According to the Council for Disability Awareness, unexpected illnesses and injuries cause 350,000 personal bankruptcies each year, and nearly half of all mortgage foreclosures.  And while many people think that disabilities are typically caused by freak accidents, the majority of long-term absences are due to back injuries and illnesses, such as cancer and heart disease.

“The fact that consumers are concerned about the financial impact of major medical issues or accidents is precisely why disability insurance is so important, especially now.  You can’t necessarily protect yourself from losing your job, but you can protect your income in the face of illness or injury.   During these uncertain times, this is a small price to pay for financial security.”, said Roberts. 

Disability insurance protects against financial disaster by replacing a portion of the insured’s income if he or she becomes hurt or seriously ill and is no longer able to work.  A typical group plan offered by an employer will replace up to 60% of the insured’s salary.  Supplemental plans and individual policies will often cover up to 70% or 80%. 

* The Caravan^®  survey was conducted by Opinion Research Corporation on behalf of Assurant Employee Benefits.  The survey was conducted between March 27-30, 2009, and is based on telephone interviews with a national probability sample of 1,001 adults (18 years and over).  The sample was comprised of 500 men and 501 women living in the continental United States.  The margin of error for this study is plus or minus three percent, at a 95% confidence level.