2013 Long Term Disability Claim Payments Soar

Disability claims payments totaled $9.8 billion in 2013, a 1.6% increase over 2012, according to the Council for Disability Awareness (CDA).  In addition, more employers (214,000) offered long term disability benefit plans in 2013 than in 2012, yet the number of insured people fell 1% to 32.1 million — a decrease that may reflect the trend toward more voluntary/employee-paid disability benefit plans in which not all eligible employees enroll. CDA President Barry Lundquist said, “Despite increased consumer confidence, many employers and wage earners seem to have adopted a wait-and-see attitude toward benefit expenditures, a possible result of economic uncertainty and the fear of continually rising healthcare costs. It is a concern that, while more employers offered long-term disability benefit plans in 2013, fewer workers are actually protected. More and more employees are becoming responsible for making their own benefit decisions, so it’s critical to educate them about their risk of an income-interrupting illness or injury and the consequences of losing their paycheck. If our education efforts in this area are ineffective, we can expect declining numbers of employees with protected incomes in the years to come.”
The following are other key findings for 2013:

• Women accounted for 56% of new disability claimants approved by CDA member companies.
• The average claimant age exceeded 50 for the first time. Claims for those age 50 and older have been increasing consistently, mostly driven by claimants over age 60. Yet, more than four in 10 new claimants were in their 40s or younger.
• Musculoskeletal system/connective tissue disorders remain the leading cause of new disability claims, followed by cancer, injuries, cardiovascular/circulatory disorders and mental disorders.
• The total number of existing claimants who received disability payments fell 3% to 653,000.

For the second year in a row, new disability claims declined after increases in 2010 and 2011. The 5.7% decrease in new approved claims in 2013 is a result of fewer claim applications received, which is one indication of an improving economy. The number of disabled workers receiving Social Security Disability Insurance (SSDI) payments last year increased 1.3% to more than 8.9 million, which is the slowest growth rate in over a decade. To get a copy of the 2014 CDA Long Term Disability Claims Review, visit www.disabilitycanhappen.org.

Last Updated 09/16/2020

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