Workers ill-prepared to manage disability income needs

Workers Ill-Prepared To Manage Disability Income Needs

09/20/2006

September 20, 2006 - American workers are in the dark about managing their income if they are unable to work due to a disability, says a new UnumProvident and Harris Interactive poll of 1,700 U.S. adults.

Ninety-seven percent of workers think leaving the job for a disability should require some level of income replacement, but only 37% actually owns disability coverage. What's more, of those who are covered 37% did not understand that the insurance would replace part of their income and assist with monthly expenses.

"This research points to a clear disconnect," said Mike Simonds, senior vice president of product development and marketing for UnumProvident. "Workers understand that some level of disability income protection is necessary, but nearly two-thirds of these workers remain uninsured. Given such a clear need, today's employers are missing a hidden gem for their benefits packages, and workers are overlooking a key aspect of financial planning," he says.

Workers also appear out of touch with just how much disability insurance coverage they need. Forty-seven percent said income replacement for a year or less was satisfactory. In reality, studies show 1 in 3 disabled persons will miss at least three months of pay and after being inactive for ninety days, the average length of disability is two years.

Disability not only prepares someone for the financial fallout from a disabling illness or injury -- it also protects people for planned leave like surgery or maternity leave.