A Great Argument for Disability Benefits

Most disability-insurance beneficiaries say their benefits played a critical role in preserving an adequate standard of living, according to a survey by the Consumer Federation of America (CFA) in partnership with Unum. Twenty-three missed a mortgage or rent payment, but an additional 49% said they would have missed a payment if they hadn’t received disability benefits. Fourteen percent 14% had to move out of their home because they could no longer afford to live there, but an additional 44% said they would have had to move if they hadn’t received disability benefits.

Forty-two percent missed at least one bill or consumer loan payment, but an additional 41% said they would have missed a payment if they didn’t have disability coverage. Thirty-one percent applied for community or government assistance to help pay for food, but without disability benefit an additional 33% said they would have applied if they hadn’t had disability benefits.

Beneficiaries did report a reduced standard of living since disability benefits typically replace only 60% of pre-disability income. Eighty-five percent had to cut back or stop saving for retirement; 58% skipped or delayed some medical, dental, or vision care for themselves or family members; and 57% cut back on spending to the point of having an uncomfortable lifestyle.

The following are some typical comments from beneficiaries about their disability benefits:
• “I would have been forced to declare bankruptcy. I would have probably lost my house and my cars.”
• “I would have lost my home. I would have been homeless and living in a shelter with my daughters. I wouldn’t have been able to afford food or gas for the car to get them to school.”
• “I have a neuro-muscular disease and I would not have been able to afford to pay for the medicine and support myself at the time. I would not have been able to survive.”

Beneficiaries said disability benefits helped them do the following:
• 77% avoid strain with spouse or partner.
• 78% maintain their self-esteem as a provider for their family.
• 88% maintain a healthy emotional outlook.

Sixty-eight percent said their health would have been worse without benefits.
Here are some typical comments from beneficiaries about how they would have felt if they did not have disability benefits:
• “I probably would have gone off the deep end.  It would have been too much to bear with the health problems I have.”
• “I would have felt awful, scared, stressed.”
• “Without the benefit payments there would have been home pressures.  I would have felt dependent, where I don’t have control of my life, trapped, child-like.”

Ninety-five percent would encourage other people to get disability insurance through their employers, and 58% said their disability benefit made them feel more favorable about their employer. Eighty-five percent said employers should automatically enroll new employees in disability insurance, allowing them to opt out of this coverage.

Eighty-eight percent of beneficiaries said that employers should do a better job of explaining disability insurance and 85% said the government should inform the public about the risk of becoming disabled and its financial impact. Workers had he following comments:
“I’m glad they made me take it. Because it wasn’t a volunteer thing, and I didn’t think that way.”
“Any employer that offers disability insurance shows that they care.  To me that’s very important because your life can change.”
“Employers should sit down and explain to the employees about their long term and short term disability coverage, because they don’t know what’s going to happen, and everyone should. I’ve made sure to tell everyone about everything, to get the insurance. Because without it, I don’t know what I would have done.” For more information, visit www.unum.com.

Last Updated 11/25/2020

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