Disability and Disability Insurance: Quick Facts

• A male worker age 35 faces a one in five risk of disabling illness or injury that prevents him from working for three months or longer during his career. For women, the risk is greater than one in four. [National Association of Insurance Commissioners (NAIC) Commissioners' Individual Disability Table A (1985)]
• The risk of disabling illness or injury that stops a paycheck from coming in is greater than the risk of dying during your working years. [NAIC Commissioners' Disability Table A and Statistical Abstract of the United States] And the financial risk of disability is greater than that from premature death because of ongoing cost of living, treatment, etc. Yet life insurance coverage is much more prevalent than long-term disability income insurance coverage. [National Compensation Survey: Employee Benefits in Private Industry in the U.S., U.S. Department of Labor, Bureau of Labor Statistics, March 2006]
• Fewer than one of three (28%) U.S. workers in private industry have private long-term disability income insurance coverage. That means that more than 100 million American workers lack private disability income protection. [National Compensation Survey: Employee Benefits in Private Industry in the U.S., U.S. Department of Labor, Bureau of Labor Statistics, March 2006]
• The financial risk of work disability is great. A 45 year-old worker who earns $50,000 a year would lose $1,000,000 in future earnings if she or he suffers a permanent disability. [America's Health Insurance Plans, Disability Insurance: A Missing Piece in the Financial Security Puzzle, 2004, Figure 2.3]
• Most workers' savings would only see them through a few months of lost earnings due to work disability. [U.S. Census Bureau Survey of Income Program and Participation]
• By far, most disabilities that interrupt earnings are caused by illnesses, not accidents. Only about 10% of work disabilities are caused by accidents. [JHA 2002 U.S. Group Disability Rate and Risk Management Survey]
• Most long-term work disabilities – more than 90 percent – are not covered by Workers' Compensation. [America's Health Insurance Plans, Disability Insurance: A Missing Piece in the Financial Security Puzzle, 2004, Figure 3.3]
• Many disabled workers who qualify for private disability income benefits wait years to qualify for Social Security Disability Insurance (SSDI) benefits – or never qualify. Forty percent of private claimants have not qualified for SSDI after one year of work disability. After four years of work disability, nearly 20 percent of private disability claimants are not collecting SSDI benefits. [Principal Life Insurance Data, 1997 – 2002]
• Relying just on SSDI to replace income lost due to work disability would leave many U.S. families below the federal poverty level. [America's Health Insurance Plans, Disability Insurance: A Missing Piece in the Financial Security Puzzle, 2004, Figure 3.2]