Payment protection offers peace of mind in case of injury or illness
May is Disability Insurance Awareness Month, a time for those of us in the financial services industry to educate our customers on how to plan for the unexpected and discuss solutions that can help alleviate financial stress during a difficult time.
A disability is a condition, physical or mental, that significantly impacts a person’s life activities.1 According to the Social Security Administration, one in four workers will suffer a disability in their working lifetime. With a quarter of the American population at risk, it is important as industry leaders to help borrowers plan for the unexpected.
Becoming disabled can create financial hardship
With more than 60 percent of Americans living paycheck to paycheck2, unplanned expenses from a disability can cause financial hardship. In fact, 61 percent of consumers say they would face financial hardship within one year if the primary wage earner would become disabled.3
When Americans find themselves in hard times, they need to lean on alternative resources to help make ends meet:
- 51% would pull from their personal savings
- 32% would look to family
- 26% would withdraw from their retirement accounts incurring penalties and
- Almost half (46 %) said they held a balance on their credit card because of an emergency expense.1
With so many households having insufficient emergency funds, Americans are unprepared for the financial impact a loss of income would mean for them and their families.
Let your borrowers know that payment protection can help
Payment protection can provide peace of mind for your borrowers when they need it most. Eighty percent of those who bought payment protection were satisfied with their decision to purchase, according to a recent Securian Financial study. They found the small added cost to be worth the protection of their finances and credit score if they were no longer able to make payments.
It’s not just well-known disabilities like cancer and multiple sclerosis that cause financial hardships. Some common disability claims are for asthma, carpal tunnel, back, shoulder and knee injuries, and arthritis.
One survey participant noted: “This made a HUGE DIFFERENCE! With unexpected medical bills piling up, this helped give me and my family some financial cushion and stress relief from it all.”
Another said: “You can’t plan when sickness will occur; I’m so thankful that this benefit was here when I needed it most.”
Help do your part to make a difference. Create awareness and educate your borrowers about payment protection solutions – it could make the difference they need during a time they need it most.
