Producer Connection

4^th Quarter 2008

Need for Disability Grows in Credit Crunch

In a recent national survey of chief financial officers and senior comptrollers conducted by Grant Thornton LLP, a tax, accounting and business advisory firm, 55% ranked employee benefits as their top pricing pressure concern. That means there could be a bigger push than ever to either shift costs or cut benefits. Cutting group disability insurance coverage, however, would be a mistake. Even before the credit crisis that’s roiling the U.S. economy, the average American family was ill-prepared to handle the financial impact of a long-term disability. With stock and house prices declining and credit harder to come by, many American households are in an even worse position today.

read more

5 Reasons for Online Enrollment and Eligibility

The average American household in 2008 has financial assets to last roughly 10 months on disability, compared to about 20 months before the credit crunch. In the first five months of disability, most families would deplete their non-retirement savings. In the sixth month, they would have to start dipping into their retirement accounts. Around the eleventh month of disability, many may be in a deficit position that would only get deeper with every passing month. Prior to the credit crunch, most families could have held out longer by tapping the equity in their homes or other noncash assets. Those sources of funding have either dried up or become much less liquid in recent months.

read more