the risk and consequence of disability: awareness, need, planning, responsibility and opportunity
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Twin Cities DI Day October 22, 2009. Barry Lundquist, CLU – President. The Risk and Consequence of Disability: Awareness, Need, Planning, Responsibility and Opportunity. “Raising Public Awareness About Disability”. www.disabilitycanhappen.org. Today’s Discussion. Environment - PowerPoint PPT PresentationTRANSCRIPT
The Risk and Consequence of Disability:Awareness, Need, Planning, Responsibility and Opportunity
Barry Lundquist, CLU – President
“Raising Public Awareness About Disability”
www.disabilitycanhappen.org
Twin Cities DI DayOctober 22, 2009
Today’s Discussion
• Environment
• Disability Facts, Perceptions, Misconceptions
• CDA Refresher: Background, History, Overview
• CDA tools (What’s in it for you?)
• What’s New at CDA? (What’s in it for you?)
• Monica’s Story
• Call to Action: How can you help?
2
Environment
www.disabilitycanhappen.org
The Disability Insurance Environment…
…is evolving…lots going on:
• Health care costs… Health care debate
• Shift to consumer driven benefits
- Decision making shifting
- Costs shifting
• Demographics
• Increasing incidence of disability
• Depleted savings and retirement accounts
- Workers embracing security
• Can government fulfill its promises?
- Let alone take on more?
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Disability: Facts, Perceptions, Misconceptions
• 54.4 million Americans reported some level of disability in 2005; roughly 1 of every 5
• Three out of 10 workers between 25 and 65 will experience a Disability of 3 months or longer
• One in 7 workers will be disabled for five years or morebefore retirement
• The average long-term disability absence lasts 2.5 years
• The chances of a 32 year old becoming disabled prior to retirement are 3.45 times greater than the chance of dying.
• Over 80% of physicians have disability insurance protection;what do they know that others don’t?
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Sources: U.S. Census Bureau, Commissioners Disability Table, 1998; Commissioners Individual Table A; Journal of the American Society of Chartered Life Underwriters; Social Security Administration Fact Sheet January 2007, UNUM
Disability: Facts, Perceptions, Misconceptions
From CDA’s 2007 Disability Awareness Study:
• 90% of workers grossly underestimate chances of becoming disabled & potential length of disability
• 85% express little/no concern about becoming disabled
• 64% unaware of disability impact on 401(k) contributions
• Women are more aware of the risks, but less prepared than men
6Source: CDA’s 2007 Disability Awareness Study
80% of workers who have planned financially for disability are confident about their ability to maintain their current lifestyle if a disability strikes.
Disability: Facts, Perceptions, Misconceptions
• 58% of adults say that they are covered by disability insurance; only around 35% actually are covered
• 71% of workers say it would be very or somewhat difficult tomeet their financial obligations if next paycheck were delayedfor one week
• 70% of the private sector workforce has no long-term disability insurance
• 66% of agents say because clients don’t ask = why they don’tsell disability insurance
7Sources: JHA, National Payroll Week 2008 Getting Paid In America Survey, Social Security Administration, LIMRA
Disability: Facts, Perceptions, Misconceptions
• 53%: ability to earn a living is most important contributor to financial security
• 86%: say workers should plan in their 20s and 30s for incomelimiting disability
• 82%: express concern about how they would pay bills if disabled
• 62%: don’t mention earnings as part of financial planning
• 54%: never discussed disability planning, how they would pay bills, etc.
• 57%: have not discussed how to manage loss of income and have no plan
8Source: CDA’s 2008 Worker Disability Planning and Preparedness Study
From CDA’s 2008 Worker Disability Planning and Preparedness Study:
“Cash is nice, but…”Employees value these benefits even more than cash.
Cash
Source: Sun Life Financial Voluntary Products Survey, 2009http://www.sunliferesearch.com/
Short-Term Disability
Life Insurance
12.9
Dental
22.0
401(k)
21.9
Long-Term Disability
Long-Term Care
Vision
14.5
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Disability: Facts, Perceptions, Misconceptions
Disability Facts, Perceptions, Misconceptions
www.disabilitycanhappen.org
Disability - a neglected risk… …overshadowed by health, longevity, pre-mature death risks
Lack of public awareness & dialogue about disability… …trends, financial impact, resources, healthy lifestyles
Slow response to a new era of personal responsibility… ...workers are increasingly in the risk business …trend toward consumer driven benefits…choice and cost …most not adequately informed or preparing
The need for a credible information resource… …help the public understand disability risks and consequences and and the value of prevention, planning and protection
CDA was established by Disability Insurance leaders concerned about lack of public awareness and understanding
--- CDA was chartered as a non-profit corporation in 2005 ---
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What is The Council for Disability Awareness?
1) the growing likelihood of disability occurring among the working population
2) the financial hardship that disability can cause wage earners and their families
3) the value of prevention, planning responsibly and being prepared in case a disability prevents one from earning a paycheck
A disability insurance industry “public service” dedicated
to raising public awareness about…
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• CDA is about:
• Educating, communicating and raising awareness
• Helping workers, employers, advisors, family members, media and any interested others understand the risk and impact of disability
• Helping workers avoid disability where possible
• Helping workers plan appropriately for the possibility of an income limiting disability
• CDA is not about:
• Selling
• Product
• Lobbying
A rising tide lifts all boats… ~ John F. KennedyA rising tide lifts all boats… ~ John F. Kennedy
What is The Council for Disability Awareness?
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What is CDA Trying To Achieve?
1. Informs wage earners about the realities and financial consequences of becoming disabled and the need to plan accordingly
2. Gets the media’s attention about growing risks of disability
3. Encourages more advisors & employers to educate employees about disability risk management and planning
4. Establishes CDA as “ the credible resource” for information about disability awareness and preparedness
5. Institutionalizes “disability financial planning” - equal status with estate, medical, investment and retirement security planning
Conduct a public awareness campaign that:
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ThanksThanks To Our To Our CDA Member Companies…
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CDA Refresher:Background, History, Overview
www.disabilitycanhappen.org
CDA Resources and Tools
CDA Develops and Distributes Tools for:
• Employees
• Employers
• Advisors
• Media members
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CDA is looking to carry out its mission of raising disability awarenessamong working Americans by communicating directly with workers,but also by leveraging channels such as advisors, employers,the media, and insurance companies.
CDA is looking to carry out its mission of raising disability awarenessamong working Americans by communicating directly with workers,but also by leveraging channels such as advisors, employers,the media, and insurance companies.
Available at www.disabilitycanhappen.org:
• Disability Facts and Statistics
• 5 Questions Every Worker Should Ask
• Disability Awareness “Quick Quiz”
• Disability Planner
• Financial Security Plan
• Income Replacement Benefits Inventory
• Healthy Lifestyle Tips
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CDA Resources and Tools
CDA Resources and Tools (cont.)
Available at www.disabilitycanhappen.org:
• Disability Studies and Surveys
• Long Term Disability Claim Studies: 2005, 2006, 2007, 2008
• Worker Disability – A Growing Risk to Retirement Security
• 2008 Worker Disability Planning and Preparedness Study
• 2007 Disability Awareness Study
• Real Life Stories
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What’s new at CDA?
PDQ – Personal Disability Quotient (March 2009)
Advisor Tool Kit (July 2009)
2008 Disability Claim Study (September 2009)
CDA in the News (Ongoing)
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CDA Resources and Tools (cont.)
What’s New? The PDQ Estimator
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http://www.whatsmypdq.org
Designed to…
1. Engage 2. Educate 3. Empower
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http://www.whatsmypdq.org
Engage: Turn them on by leading in with a different question
http://www.whatsmypdq.org
Educate: Use the PDQ estimator to raise awareness of the risk
PDQ Results Page
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http://www.whatsmypdq.org
Educate: Use the EIQ estimator to show how much is at risk
EIQ Results Page
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http://www.whatsmypdq.org
Action Plans Page
Empower: Turn awareness into action by integrating other tools
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http://www.whatsmypdq.org
What’s New?PDQ Advisor Toolkit - Marketing Materials
Personalize the PDQFlyer; use the PDQ Graphics
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http://www.pdqtoolkit.org
PDQ Advisor Toolkit - Web Buttons
ADD PDQ to Your Web Site
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http://www.pdqtoolkit.org
PDQ Advisor Toolkit - Flyer
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http://www.pdqtoolkit.org
CDA Tools (What’s in it for you?)
www.disabilitycanhappen.org
CDA 2008 Disability Claim Study CDA Member Company 2008 Claim Results
2008 CDA Long Term Disability Claims Review 76% LTD & IDI market share
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154,000,000 covered workers: + 15%
7,430,000 total disabled workers: + 58% (plus 1.8 million spouses and children)
890,000 new disabled workers in 2008: + 46%
2,320,000 applications: + 98%
38.4% approval rate in 2008
Average current backlog: 17 months
Average age: 51
Average monthly benefit: $1064
• 37% increase in rate of disability – 50% increase for female workers
Source: SSA 2007/8 Annual Statistical Supplement.
Rate of worker disability… …continues to rise at an increasing rate…
SS Disability Trends: 1998 - 2008
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SSDI Claim Approval Rate Declining
0
10
20
30
40
50
60
1994 1996 1998 2000 2002 2004 2006 2008
% of SSDI Applications Approved
33Source: www.socialsecurity.gov
Percent of SSDI Claim Applications Approved 1994-2008
0
500
1,000
1,500
2,000
2,500
3,000
3,500
199419951996199719981999200020012002200320042005200620072008
Est. 2009
SSDI Claim Applications vs. Approvals1994-2008
SSDI Applications
SSDI Awards
0
500
1,000
1,500
2,000
2,500
3,000
3,500
199419951996199719981999200020012002200320042005200620072008
Est. 2009
SSDI Claim Applications vs. Approvals1994-2008
SSDI Applications
SSDI Awards
Number of SSDI Claim Applications Compared to Approvals – 1994-2009 (est.)
Source: www.socialsecurity.gov 34
What’s New at CDA?(What’s in it for you?)
www.disabilitycanhappen.org
What’s New? Advisor Tool Kit – New Additions
Advisor Homepage
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What’s New? CDA 2008 Disability Claim Study
CDA Member Company 2008 Claim Results:
156,000 new LTD/DI claims approved in 2008
574,000 existing LTD/DI claimants
$7.9 Billion in paid claims (7% increase)
2008 CDA Long Term Disability Claims Review 76% LTD & IDI market share
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Advisor Toolkit – Graphs and Charts Library
Graphs and Charts from the 2008 Claim Study have been added to the toolkit.
Visitors may download theGraphs and Charts and add them to presentations and marketing materials.More to follow!
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What’s New?Media Outreach: CDA in the News
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Monica’s Story
www.disabilitycanhappen.org
Monica’s Story
Monica had it all by the ageof 37 — a successful career in
the financial field, a wonderful son,and big dreams for the future.
She never dreamt that a disabilitywould change her life forever…
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Monica’s Story
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My Boy’s Haven
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A Canadian’s Dream Abode
Monica’s Story
44
Our Prime Minister’s Manor
Monica’s Story
45
California Dreamin’
Monica’s Story
46
The Million Dollar Bracelet
Monica’s Story
47
Humpty Dumpty Falls
Monica’s Story
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Think Safety First
Monica’s Story
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Life Happens
Monica’s Story
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The Penthouse Suite
Monica’s Story
51
The Outhouse
Monica’s Story
52
Jolly’s Follies
Monica’s Story
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Mr. George
Monica’s Story
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Casa Georgie
Monica’s Story
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HUMPTY DUMPTY THE BLONDE
• Humpty Dumpty had a slip and fall and all the king’s horses and the king’s greatest men continually attempted to piece Humpty back together again.
• They tried and they tried with all of their might and always put up such a valiant fight.
• To mend the young broken egg who crumbled like a shell, to piece back together the egg to make whole.
• We honor and cherish your gallant efforts to achieve a life again given to the woman in such dire need.
By: Monica Soltes, April 2005
Monica’s Story
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• "Success is the number of lives that you can positivelychange or affect” ~ Monica M. Soltes
• "Success is the number of lives that you can positivelychange or affect” ~ Monica M. Soltes
Reasons to Invest in and Recommend Disability Insurance:
• For your children, spouse, friends, family and parents
• Consider ‘Disability Insurance’ as ‘Living Insurance’
• Do not risk having shelter, food, clothes, medical care, independence
• Plan that a disability could be a long-term or lifetime high risk exposure
• Share a ‘dramatic’ disability story to encourage planning; being unprepared and becoming disabled is a ‘traumatic’ experience for all
• Become a hero in someone’s life story
Monica’s Story
Call to Action: How can you help?
www.disabilitycanhappen.org
As CDA Succeeds in Raising Disability Awareness…
Risk of “losing your ability to earn a living” is elevated to a most
important risk to protect
Wage earners will be prepared to understand & manage all the
financial risks associated with disability
Benefits decision makers (advisors, employers, employees) will be
better equipped to make best choices and recommendations
Disability Planning will be an essential to every financial plan
“We” will deliver real value to the market place by creating more
personal financial security
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Call to Action:…What Can YOU Do To Help?
• Visit and use the CDA website
• Use CDA tools, data and information – andrecommend them to others
• Discuss CDA: on Social Networking sites, inDI Forums, study groups, etc.
• Tell us what you need to inform and educate wage earners, employers and others – we will deliver!
• If your company(ies) are already supporting CDA – please tell them THANK YOU… and to keep doing it!
• If your company(ies) are not already supporting CDA – please tell them they must… we need all companies to join!
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The Council For Disability Awareness……a Rising Tide Lifts All Boats!
Thank You!
www.disabilitycanhappen.org
Barry Lundquist, CLUThe Council For Disability Awareness
75 Pearl Street, Suite 205Portland, ME 04101
207-774-2634