With health care reform commanding most of the insurance headlines lately, it is all too easy to place disability insurance on the back burner where we most prefer to keep life's scary things.
After all, health insurance sounds so optimistic. Health! Vibrancy! Viva la vida! And most of the high-profile handwringing, congressional and otherwise, has centered on controlling the costs of and expanding access to health insurance, which qualifies as major duh on the obvious-o-meter.
Disability is a different, darker animal. Disability is nonhealth. There's a sense of unfairness about disability, a rail-at-the-gods fury at being singled out that makes disability insurance a hard sell, even to otherwise rational folks.
So it should come as no big surprise that the recent MetLife Study of the Emotional and Financial Impact of Disability found that three in five Americans who were out of work for at least six months due to a disability did not have disability income protection.
Among those who did have coverage, only about one-third of their income on average was provided for under their disability insurance policy.
Unlike life insurance, it is possible to study the emotional impact of disability insurance on the insured after the fact. Based on the responses from MetLife's sample group of 300 people ages 25 to 55 who had experienced a nonworkers' comp, nonpregnancy related disability during the past 10 years and have since returned to work, disability insurance may deserve a little front-burner time.
Allowing that few of the participants had satisfactory disability insurance, having coverage that they considered "somewhat adequate" lessened the blow considerably: 91 percent with inadequate coverage said their disability had a "major or devastating" emotional impact versus 63 percent with somewhat adequate coverage. Adequate coverage also lessened the strain on relationships (37 percent vs. 54 percent) and reduced feelings of depression and anxiety (58 percent vs. 77 percent).
In tough economic times, an increasing number of us face difficult decisions on how or whether to insure our money or our life. It can be a difficult call: Statistically, we are far more likely to become disabled at some time during our working years than we are to die prematurely, but should we perish, all income goes with us.
How much disability coverage should you have? How much can you afford?
This key finding in the MetLife study may help those with at least adequate disability coverage sleep better at night:
"The MetLife study found that, in general, people with disability income protection coverage return to work three months sooner than the people without coverage. More significantly, the study found that they were also about twice as likely to return to the same employer in the same function than those without coverage."
If you still need a nudge to confront the subject, don't call it disability insurance.
Think of it as a recovery plan instead.