Why Devote a Month to Disability Insurance Awareness?

Your most important asset is not your home, your car, your jewelry or other possessions. It's your ability to earn a living. Think about it: All of your plans for the future-from buying a home, to putting your kids through college, to building a retirement nest egg-are based on the assumption you'll continue to earn a paycheck until you retire. But what would happen if those paychecks stopped? That's where disability insurance comes in. It provides an income to you and your family if you are unable to work because of illness or injury.

Though disability is behind a significant number of home foreclosures and personal bankruptcies, insuring against it has not been a high priority for most workers because many assume they're already covered through Social Security, state-mandated Workers' Compensation or employer-provided group plans. However, there are numerous holes in this safety net of coverage.

Only about 39% of the 2.1 million workers who applied for Social Security Disability Insurance benefits in 2005 were approved. And those who are approved get an average benefit of just $1,063 monthly-hardly enough to replace the average worker's income. Workers' Compensation covers only work-related disabilities, but according to the National Safety Council, 73% of disabling accidents and illnesses aren't work-related. And what about coverage through work? It's a great employee benefit, but it's not available to many workers. Only 36% of all full-time employees have access to long-term disability insurance through their employers.

So what's a worker to do? Explore your options. If your employer offers disability coverage, take the time to find out if the coverage would be sufficient to meet your income replacement needs in the event of a disabling illness or accident. If it's insufficient, your employer may offer you the option to increase your disability benefit, often through a voluntary payroll deduction. Another option is to purchase coverage on your own.

May is Disability Insurance Awareness Month (DIAM), the perfect time for a disability insurance "reality check." Take this opportunity to make sure you'd be OK financially in the event that a disability keeps you out of work for an extended period of time.

Disability Insurance Awareness Month is coordinated by the LIFE Foundation, it's a time when the insurance industry comes together to do something about the enormous gap that exists between Americans' need for disability income protection and the actual coverage they have in place. LIFE has designed a DIAM Planning Toolkit and many other free resources to help insurance professionals pull together a quick and effective campaign for May.  These resources are available on Life's website.  http://www.lifehappens.org/diam/