'That'll Never Happen to Me'

What happens when a pay check is interrupted for even to months, and what if that interruption continues for six months, or years? 

“Just over one in four of today's 20 year-olds will become
disabled before they retire.” 
 

That is a fact reported by the Council for Disability Awareness, a nonprofit education group (disabilitycanhappen.org).

Couple that with these facts:

  • serious health problems are the underlying cause of most personal bankruptcies and home foreclosures in the US due to expensive medical bills and lost income due to disability
  • 62% of all personal bankruptcies in 2007 and over 50% of home foreclosures were due to a debilitating accident or illness. (disabilitycanhappen.org)

If you are young and reading this article, you are thinking, "But I'm young and healthy; nothing will ever happen to me." Please re-read the first paragraph. If you are older, you're thinking, "Well I've made it this long and I'm healthy, so I am probably safe."

Think about it. Worker's comp insurance only pays for wages lost due to an on-the-job injury, and health insurance helps pay for the medical bills associated with the accident or injury. What happens if you or your employee had a life altering accident on a motorcycle or were diagnosed with multiple sclerosis?

According to a study conducted by the Council for Disability Awareness in 2010, 62% of working respondents believed they had a 2% or less chance of being disabled for 3 or more months during their working career.  And yet the Social Security Administration indicates that there is a 25% likelihood that a wage earner will be disabled for 3 months or longer during their working career. (SSA, Fact Sheet February, 2013.)

So yes, the vast majority of us believe it will happen to somebody else or some other company's employees. Yet, the facts tell a different story.

Sure, you do the required OSCHA training to keep your employed safe from accidents.  But according to the Council of Disability Awareness, 90% of all disability insurance claims are for illness.  "Thanks," you are saying.  "One  more thing to worry about it!  And besides, I provide worker's comp insurance and offer health insurance."

We passionately encourage you to offer long term disability insurance to your employees and purchase it for yourself.

Think about it.  Worker's comp insurance only pays for wages lost due to an on-the-job injury, and health insurance helps pay for the medical bills associated with the accident or injury. What happens if you or your employee had a life altering accident on a motorcycle or were diagnosed with multiple sclerosis?  

The answer may be buying long term disability insurance for yourself and offering it to your employees.  Most of us purchase insurance to protect our homes without a thought.  We know it is the right thing to do. Yet, suffering a long term disability is much more likely than your house burning down according to human resources consultant Rich Fuerstenberg with Mercer.

So what is the difference between long- term health insurance and long- term disability insurance?  Long-term disability insurance provides a  continuation of a major portion of your wages for the duration of your disability.   Think of it as the "paycheck portion of your health insurance" says policygenius.com.   Other countries refer to it as "income protection."

Now, I want to make this personal.  As a member of the board of directors for the Joseph Groh Foundation, I have read many heart-wrenching accounts from people in our industry who themselves or a family member have suffered a life altering accident or illness. And while reading about the accident or illness and its ramifications is difficult, even more difficult is reading about the financial devastation that has  occurred as a result of the disability.  

Many of us live from pay check to pay check and perhaps even more employees are in this situation.  So what happens when that pay check is interrupted for even 2 months and what if that interruption continues for 6 months or years?  How long can your company through its generosity continue to financially help that employee?  Long term disability insurance is a much better answer.

What about the cost?  One web-site estimated the cost at 1% to 4% of wages.  Not much when put in the context of financial ruin.

At the Joseph Groh Foundation, we are driven to help as many people as possible who find themselves in the life challenging task of living with the physical aspects of a debilitating illness or accident and the financial ramifications that always seem to occur.

At the Joseph Groh Foundation, we are driven to help as many people as possible who find themselves in the life challenging task of living with the physical aspects of a debilitating illness or accident and the financial ramifications that always seem to occur.  Unfortunately, the requests for help always outrun are capacity to honor all of those requests.

And for once, on behalf of the Joseph Groh Foundation, we are not making a plea for money. Instead, we want to passionately encourage you to offer long term disability insurance to your employees and purchase it for yourself. At the Foundation, we know this can help more people than we will ever have the capacity to reach.  Unfortunately, accidents and illnesses are a part of life, but financial devastation does not have to be an inevitable outcome.

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