CCIA Says Don't Overlook Disability Insurance, Risk Greater Than We Know

Business Wire, Dec 27, 2005

CHICAGO -- Consumers often overlook the possibility they will be disabled, a risk greater than we think, the Consumer Credit Insurance Association (CCIA) observed today, highlighting the value of disability insurance.

"The statistics would startle most people who never faced disability because of an accident or ill health," said CCIA Executive Vice President William F. Burfeind, "But the probability of disability is much higher than people believe."

He said, "Consumers need to learn more to weigh whether they should protect their incomes and ability to repay debt if they are unable to work because of disability."

He noted, "Credit disability insurance insures that debt payments on insured debt like home mortgages, credit cards, and bank and auto loans will continue to be paid for a specified period of time in the event of disability. "

Burfeind cited these facts from www.protectyourincome.com, a website of the Disability Insurance Education Center:

--People below age 35 have a one in three chance of becoming disabled for at least six months during their working lives, and a 50 percent chance before age 65

--During careers, men have a 43 percent career chance and women a 54 percent chance of serious disability

--Disability chance is three to five times as great as the chance of death

--Over 375,000 Americans become wholly disabled each year

--Some 110 million Americans lack long-term disability insurance.

Similarly, when disability occurs most people face serious financial consequences.

--46 percent of conventional mortgage foreclosures are caused by disability-related income loss compared to 2 percent from death

--Yet the average nationwide monthly Social Security disability payment is just $722 and only about 35 percent of those who apply receive it because of strict requirements.

"The facts show that disability will affect many lives and that most people will be caught short financially if it happens," Burfeind said.

Other forms of credit insurance insure debt will be repaid in the event of death, involuntary unemployment or the loss or damage of property.

Based in Chicago and founded in 1951, the 140-member CCIA is a trade association of insurance companies and other financial service providers selling or servicing consumer credit insurance, credit related lines of insurance, and other consumer credit protection products.