Author Archives: Steve Aldrich

Misconceptions of coverage driving low participation in disability insurance

Many workers erroneously believe that a disabling illness or injury will be automatically covered by workers’ compensation or SSDI.

May 7, 2019 | By Katie Kuehner-Hebert – BenefitsPro

There are a number of myths that are causing many workers to not buy disability insurance, according to Prudential’s whitepaper, “Why Disability Income Protection Should Be Part of Your Financial Wellness Toolkit.”

While a majority of employers offer short-term disability and long-term disability benefits to their employees, only 38 percent of workers in private industry were participating in STD income insurance; 33 percent were participating in LTD income insurance, and more than 50 million U.S. workers don’t have disability income insurance.

“Prepared or not, most Americans are at least aware that they should attempt to save for emergencies and retirement,” the authors write. “Most, however, overlook taking the right steps to protect against one of the greatest threats to their overall financial security: being unable to earn a paycheck as a result of a short- or long-term disability.”

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SSDI Expert Answers Questions During Disability Insurance Awareness Month

Many U.S. workers are unfamiliar with their options when a severe health condition takes them off the job

Steve Perrigo, Allsup Vice President, answers common questions in observance of Disability Insurance Awareness Month in May.

May 1, 2019 | Globe Newswire

Disability Insurance Awareness Month in May highlights the importance of disability insurance as a financial and economic tool for American workers. According to U.S. Bureau of Labor Statistics data, 42% of workers have access to short-term disability insurance and 34% have access to private long-term disability coverage. More than 155 million workers are insured for Social Security Disability Insurance (SSDI) benefits. Yet many workers still don’t realize the implications for their financial and work futures, according to Allsup, the nation’s premier provider of Social Security Disability Insurance representation services.

According to one study, only 38% of Americans are knowledgeable about disability insurance. Considering one in five Americans report having some type of disability, closing the knowledge gap could lead to improved choices by workers and advantages for the greater economy.

“The worst thing that can happen for some individuals is to totally miss out on the valuable advantages of disability insurance through a misunderstanding of its purpose and role for workers, especially following a disability, when their lives are already upended,” said Steve Perrigo, Allsup vice president. “Many people don’t realize there is a dual purpose to disability insurance: income and then support with returning to work.”

Why do I need disability insurance?

The data show that 1 in 4 workers, by the time they reach full retirement age, will experience a disability that prevents them from working. Disability insurance—both public and private—is expressly designed to help workers avoid financial devastation with the lost income when this happens.

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Just 4 in 10 Employees Protecting Their Paychecks

Snapshot of disability coverage revealed in The Harris Poll – OneAmerica® findings

May 1, 2019 | Business Wire

Roughly 4 in 10 working Americans (41%) report they have employer-sponsored disability insurance coverage, according to a new survey conducted online by The Harris Poll on behalf of OneAmerica®. However, less than one quarter of working Americans (24%) elect to have voluntary disability insurance through their employer ─ where employees have to pay for coverage themselves ─ leaving many without this key paycheck protection.

This new survey of short-term or long-term disability insurance coverage was conducted among 1,017 U.S. adults ages 18 and older who are employed full-time or part-time.

Disability Insurance Awareness Month is observed annually in May. OneAmerica uses the survey results to help educate consumers and to challenge assumptions.

Of the 64% of working Americans who report not having voluntary disability coverage, just under half (47%) say it is because their employer does not offer it; among them, nearly 3 in 5 (58%) say if their employer was to offer it, they would be likely to purchase it.

Those who do not have voluntary disability coverage through their employer cite the following as additional reasons for not selecting coverage:

  • Don’t see the value (14%)
  • Other obligations or expenses they feel are higher priorities (11%)
  • Can’t afford coverage (12%)
  • They think they are healthy and don’t need it (12%)

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Disability Insurance Awareness Month Taps Into Financial Wellness Movement

CDA is emphasizing that protecting paychecks fits in with general financial literacy and sustainability efforts.

April 30, 2019 | By Allison Bell for ThinkAdvisor

Life Happens and the Council for Disability Awareness (CDA) are heading into the May 2019 Disability Insurance Awareness Month (DIAM) campaign with a focus on making income protection part of financial wellness.

The CDA, for example, will be observing the month by encouraging consumers and others to “get the facts,” and to visit a blog that features stories about financial, physical and emotional wellness.

Recent CDA blog posts cover topics such as general financial literacy and Earth Day as well as disability insurance.

Life Happens has also been offering agents, brokers and others digital materials that emphasize stories about real people, such as Dore Bakouris, a new mom, who suddenly discovered what it means to lose the ability to earn a paycheck, or to lose the ability to handle tasks at home.

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Disability insurance can protect you from unthinkable

April 10, 2019 | By Terry Savage | Chicago Tribune

Income tax time brings you face to face with the amount of money you earn — and have left to live on, after taxes. But what if you were disabled and couldn’t work? It’s something no one wants to think about: being incapacitated. But consider the odds.

The Disability Insurance Resource Center says that for a 32-year-old, a serious disability (three months or longer) is 6 1/2 times more likely than death. It also notes that only 3 percent of mortgage foreclosures are caused by death, while 48 percent are caused by disability.

The average disability lasts two to four years, but some people are disabled for life. And that’s where disability insurance comes in. There are basically two ways to purchase disability insurance.

Disability insurance may be offered as part of a group benefit provided by your employer or purchased independently. It costs less when purchased through a company benefits plan, and premiums are usually paid with pretax dollars.

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LTD Insurance Auto-Enrollment: A Potential Tailwind for Market Players

April 17, 2019 | From Business Wire for insurancenewsnet

OLDWICK, N.J.–(BUSINESS WIRE)– A rule clarification that allow employers the option to provide long-term disability coverage to their employees through automatic enrollment should benefit insurers by increasing participation rates, and increased marketing efforts and evolving employee attitudes may increase penetration rates, according to a new AM Best special report.

A recent decision by the U.S. Department of Labor expands automatic enrollment programs in all states to include disability insurance plans, with an opt-out choice, preempting any state laws specifically banning auto-enrollment for the product. The Best’s Special Report, titled, “LTD Insurance Auto-Enrollment: A Potential Tailwind for Market Players,” states that from 2012 to 2017, net premiums written for group long-term disability (LTD) rose more than 30%, to $12.6 billion from $9.7 billion, while the number of covered lives grew 28%. Based on the experience of some insurers already offering the automatic enrollment option in certain states, participation rates could grow by 10% to 15%, with continued growth opportunities in the employer group space.

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Disability Insurance Can Keep One Disaster From Causing Another

An Insurance executive talks about a terrible hole in many of your clients’ planning.

April 12, 2019 | By Wendy Herndon for ThinkAdvisor

A car breaks down during rush hour. A computer malfunction wipes out a key presentation. An alarm clock does not ring on the morning of an important meeting. Inconveniences, yes, but not true disasters, no matter how terrible they may be at the time.

Consider these situations: An employee falls off the roof while cleaning gutters. Another is hospitalized after a major car accident. A third is diagnosed with a serious heart condition. These are all unfortunate situations, yet not in the least improbable — and each event qualifies as a true personal disaster.

Here is something else disastrous: Odds are that just one of those individuals would have supplemental disability insurance in place to help ease financial burdens during treatment and recovery. That is because according to a recent study by One America, only a mere 34% of American workers have disability coverage provided by their employer. Of this number, 43% said the reason for this lack of coverage was because it was not offered at the workplace.

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Disability Insurance: Definition, Why You Need It and How to Get It

Disability insurance is an important component of your overall financial planning efforts. You are more likely to become disabled than to die during your working years, disability insurance can help ensure that you can maintain your lifestyle.

March 22, 2019 | By Roger Wohlner – The Street

Disability insurance should be a key part of your overall financial planning. Insurance is designed to cover losses that are too big to cover with your own out-of-pocket funds. Life insurance provides a benefit to your beneficiaries should you die. Health insurance covers the cost of medical care should you or your family need it. No less important is disability insurance that covers lost income in the event that you are unable to work due to a disabling injury or illness.

What Is Disability Insurance?

Disability insurance could also be called “income insurance.” Disability insurance provides an income stream in the event that you are unable to work for periods of time ranging from short-term to long-term. Disability insurance differs from other forms of insurance like medical or life insurance in that it is specifically designed to replace a portion of your income in the event that you are unable to work for a period of time due to an illness or an injury.

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Life insurance: Do you know what to look for?

Learning more about permanent life options may be a point of differentiation with your employer clients.

March 21, 2019 | By Bonnie Brazzell and Nick Rockwell – BenefitsPro

Recent Eastbridge research has found that while just over half of carriers offer a universal life/whole life (UL/WL) product today, almost a quarter of carriers see UL/WL as a growth product for the industry over the next few years. In addition, UL/WL was the top product (tied with hospital indemnity) listed as most likely to be added to carriers’ voluntary portfolios in the next two years.

Despite carrier investment in developing and enhancing permanent life products, most brokers did not include UL/WL in their top five most frequently sold products. Our joint BenefitsPRO/Eastbridge survey found that four of the top five most frequently sold products are the same for benefit brokers and voluntary brokers. With such similar portfolios, learning more about permanent life options may be a point of differentiation with your employer clients.

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10 tips for selling voluntary and new products

As you work with employers to help them expand their offerings and put together a best-in-class benefits plan, here are 10 tips to keep in mind.

March 6, 2019 | By BenefitsPRO Editors

Have you heard about the labor market? It’s hot, and employers are struggling to attract and keep top talent. This past year saw a significant change in employers’ benefits strategies, as their top priority shifted from controlling costs to competing for talent.

Health insurance, paid time off and flex scheduling continue to be major draws for candidates, but employers are also sweetening the pot with an array of voluntary benefits. The cherry on top might be the ease of access and use of these benefits, making a good benefits administration platform a must.

As you work with employers to help them expand their offerings and put together a best-in-class benefits plan, here are 10 tips to keep in mind.

1. The most successful brokers have long ago cast aside the assumption that employers are not interested in voluntary and have been tirelessly working to understand and align themselves towards employers’ most pressing voluntary-oriented needs. — Bonnie Brazzell, Eastbridge Consulting Group

2. K.I.S.S. (Keep It Simple, Stupid): Negotiate high guaranteed-issue amounts for voluntary benefits. Then, limit choice to those G.I. options. Employees want simplicity in enrolling and employers want a streamlined process. — Kevin Kennedy, TriBen Insurance

3. When voluntary benefit programs are positioned as an integral part of the employee benefit experience, employees are more likely to understand the value. Communicate that voluntary benefits can be an integral part of a “total rewards package.” — Peter Marcia, YouDecide

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