No Disability Insurance Can Be Costly
Thursday, July 2nd, 2009Cited: Dolan Media Newswires Colorado Springs Business Journal
If you do not have disability insurance and get injured or disabled on the job or off, it can be a very big financial impact. In fact, the cost of not having disability insurance can be 20 times your annual salary. Life Foundation and America’s Health Insurance Plans did a study that stated just that. The study looked at various types of income protection that reduce the financial risks of disability as well as the consequences facing people who cannot work because of a disability or injury.
In the absence of insurance, a majority of Americans would have to make “drastic lifestyle changes” in order to cover the costs associated with disabilities, regardless of whether the disability is short- or long-term. The study found that the financial impact - equal to lost income plus expenses - can be as high as nearly $1 million for a 40-year-old single man earning $50,000 annually who suffers a long-term disability lasting until 65. The costs associated with short-term disabilities also can be significant - equaling one to two times income in some cases for a disability lasting two years.
Those hardest hit by the costs are single individuals who do not have a second income to rely on; lower income people, because added expenses are greater relative to the lost income; and those who suffer longer-term disabilities.
More than a quarter of Americans admit they would have difficulty supporting themselves financially immediately after a disability, while 49% would reach that point within a month, according to Life.
“Our experience tells us that if you become disabled and don’t have disability insurance, you’re going to have a very rough go of it. This study quantifies the impact of a disability so working Americans can get a better understanding of financial difficulties they’ll likely face without proper insurance coverage,” said Marvin H. Feldman, president and CEO of the foundation. “Disability insurance provides a financial safety net that can be counted on to replace lost income if you were suddenly out of work due to illness or injury.”
The study also shows that various sources of disability insurance provide valuable income replacement to help cover the high costs of disability. Private disability insurance plans, such as employer-sponsored or individual coverage, can reduce the cost of a disability by 70% to 80% Individual disability coverage, in combination with employer- or government-sponsored insurance programs, can reduce the financial cost of disability by 80% to 95%.
For those employers looking for more payroll options for their employees . . . Your employees are what keep your business ticking, and you can offer a solution that automates all critical functions including benefits management, payroll connectivity, workflow automation, and the hire-to-fire process. You can get employee payroll services that create a comprehensive and paperless HR management environment. You could even offer online payroll services for those employees who work in the field.
The study also makes clear that while government-sponsored disability insurance - either through Workers’ Compensation or Social Security - is available to many working Americans, it can be difficult to qualify for. Workers’ Compensation insurance is limited to disabilities that occur on the job, but a vast majority (90%) of injuries happen outside the workplace, and are therefore not covered by Workers’ Compensation programs. During recent years, only about 45% of initial applications for Social Security benefits have been approved, and the average monthly benefit, $1,062, is barely above the poverty level.
“The Social Security Disability Insurance program can be one source of disability income for many Americans, but this is no guarantee that disabled individuals will be eligible for SSDI,” said Karen Ignagni, President and CEO of AHIP. “Working Americans and their families can benefit from the value that private disability income insurance provides.”
According to the study, it is not just the financial stress that can cause problems when a disabled person is overwhelmed by the expense of medical costs. A person’s self-worth and overall happiness can be directly tied to their financial status. That financial status can possibly cause problems with a person’s disability simply because of the stress. This makes it difficult for a person to get back on their feet to any degree.
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My Take: Every employer is required by law to provide Worker’s Compensation. However, this does not cover the complete costs if the disability or injury is permanent. It may cover equipment such as wheelchairs and walkers if those are needed permanently and it will give you a percentage of your weekly paycheck as compensation.
I think the best thing anybody should do is ask their employer to offer disability insurance that can be deducted from their paychecks on a weekly or biweekly basis. Depending on the insurance, this should not be too much of a burden financially. A person should think of the benefits they will get if they are injured or disabled permanently and cannot work.
Becoming permanently disabled is not something people anticipate. There is always a possibility of becoming permanently injured or disabled. It could happen on the job, on your way to work, on your way home from work or even in your home.
Many young people today have realized that they need to prepare for retirement now. However, they are not anticipating disability in the future. They need to realize that we live in a 50-50 world. There is always that chance that something could go drastically wrong. If they do not have disability insurance for that reason, they may be in a financial crisis.
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While you are looking for quotes, you might also look for long term care insurance quotes for yourself and your husband in your golden years. This would lift the burden your family shoulders. Long-term care refers to a broad range of medical and personal services designed to assist people who have lost their ability to function independently. If you are thinking of buying Long Term Care Insurance (LTCI), you will want to make sure it covers the services you may need.
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Business Financing
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Strict Liability
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When Does a Personal Injury Claim Begin?
When you contact North Carolina personal injury attorneys, your personal injury claim will begin and it will end with the conclusion of the case whether with a settlement or the trial concluded with a judgment given. You need to make sure that you file your claim within a specific time period after the accident or illness. Otherwise they become what is called “statute barred” and will not succeed. This time limit varies state to state that is usually approximately 3 years. When you have had an accident, you should consult an attorney while events are fresh in your mind instead of waiting and trying to recall what happened months or years later.
Had a Traffic Accident?
Minor traffic violations can have big consequences if not handled properly including a simple speeding ticket. Depending on the circumstances a person’s license could be suspended for a certain period of time as well as insurance premiums can go up significantly. However, if you have an accident you could be talking to Texas injury attorneys about alternatives to pleading guilty to specific charges on a citation. You will need to carefully consider the alternatives available to determine what is right for you. With an attorney handling the case, you may be able to keep your insurance premiums low and protect your driving record.
CSI Type Services
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Qualifying For Auto Insurance
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Need Help
Are you looking for an experienced and effective Texas personal injury attorney or personal injury lawyer? One law firm can help you! When you choose this law office to represent you on your personal injury case, you are partnering yourself with a group of attorneys who do not merely dabble in personal injury law, but rather a highly specialized firm that spends all day, every day, winning cases just like yours. If you need help with any personal injury matter, the experienced and dedicated staff in this law firm is here to help you!
Bicycling Accidents
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