Insurance Trends

2024 Insurance Barometer Study

Disability Insurance Awareness Month: protecting your paycheck and your future

A new report conducted by LIMRA and Life Happens shows that 46% of U.S. adults say they need some sort of disability insurance. Yet, currently, less than 1 in 5 consumers (18%) say they have it.

Although no one likes to think about it, the likelihood of a disability is more common than people realize. The Social Security Administration reports that about 1 in 4 of today’s 20-year-olds will become disabled before reaching retirement age.[1] In addition, the Centers for Disease Control and Prevention notes that 27% of American adults currently live with a disability.[2] These statistics underscore a major truth: We must protect our incomes from the impact of an unexpected disability.

Despite this evident need for disability insurance, LIMRA data suggests a significant gap between those who recognize they need coverage and those who actually have coverage. The 2024 Insurance Barometer Study, conducted by LIMRA and Life Happens, shows that 46% of U.S. adults say they need some sort of disability insurance. Yet, currently, less than 1 in 5 consumers (18%) say they have it — and LIMRA estimates that true individual ownership may be far less. This does not include coverage they may have obtained through work.

Lack of knowledge about disability insurance could play a big role in the lack of protection. Just 16% of adults say they are very/extremely knowledgeable about disability insurance. This signals a significant need for education about disability coverage not only on the individual level but within the workplace as well. According to the LIMRA’s 2024 BEAT Study, employees opt out of employer-sponsored disability plans for the following reasons:

  • They don’t believe they need the benefit
  • They don’t think the benefit is worth the cost
  • They don’t think they can afford the benefit

Less than half of employees believe they understand disability insurance somewhat or extremely well. What this ultimately shows is that our industry can do more to better educate and communicate the need for disability coverage, the value it provides, and the risks of not having coverage.

The Cost Of Disability

One way to build awareness and understanding around disability insurance is by educating consumers and employees about the cost a disability can inflict upon a household. The National Disability Institute found households with one adult who has a disability require 28% more income to retain a similar standard of living than households without an adult with a disability.[3]

The workplace continues to be an important way for consumers to obtain the insurance coverages they need...

That’s a staggering number. According to 2024 Insurance Barometer Study data, consumers without disability insurance coverage say their families would resort to tapping into personal savings (48%) or retirement funds (26%) to meet their day-to-day expenses. Consumers need to understand that there’s a lot at risk should the primary wage earner become disabled. Disability insurance can help safeguard against undermining one’s future financial security.

Disability Insurance In The Workplace

“The workplace continues to be an important way for consumers to obtain the insurance coverages they need,” notes Patrick Leary, corporate vice president, LIMRA Workplace Benefits Research. “This is especially true of middle-market consumers who may not have a personal financial advisor to help them address these needs.”

In fact, according to LIMRA’s Consumer Sentiment survey, more than 7 in 10 workers rely on — at least to some degree — their employee benefits plan to meet their disability insurance needs. It’s important to keep reemphasizing the value of participating in an employer-sponsored disability insurance plan to protect their financial future.

Sixty-seven percent of employees who choose not to enroll in disability benefits either believe the coverage is too costly or say they don’t need it. The truth is that many employers provide disability coverage on an employer-paid or contributory basis, where the employer and their workers share the cost of coverage. However, just 56% of workers can definitively say whether their employer offers disability insurance. This again highlights the need for effective communication and education around disability insurance benefits.

The 2024 Insurance Barometer Study shows that 20% of adults say they intend to purchase disability insurance coverage within the next 12 months. Of course, intent does not always translate into action. During Disability Insurance Awareness Month, the industry has an opportunity to keep educating consumers and hopefully spur them to purchase the coverage they need to protect their income.




1 Social Security disability insurance is coverage that workers earn, Social Security Administration, 2022.
2 Disability Impacts All of Us, Centers for Disease Control and Prevention, 2023.
3 The Extra Costs of Disability: Resetting the Policy Table, National Disability Institute, 2021.