Disability Insurance: Key Facts You Need to Know

While an unsettling thought, you can take comfort knowing that there is an easy way to plan for the unexpected through disability insurance which helps replace a portion of your lost income. Your health insurance covers only your medical expenses. By investing in disability insurance, you protect yourself and your family from the uncertainty that comes with unforeseen medical or health challenges, providing peace of mind and financial stability.

Consider the following:

The likelihood of a 20-year-old worker being disabled before they retire is more than 1 in 4. 1

If this statistic seems high, it’s important to keep in mind that 90% of all disability claims are the result of common illnesses such as stroke or cancer, not random accidents. That’s why it makes so much sense to protect yourself and your loved ones from the financial impact a disability could have during your working years. After all, how long would you be able to make ends meet if you were out of work for a month, a year or possibly even longer?

The average disability claim lasts almost three years.2

While Social Security may seem like the obvious solution, benefits are limited to long-term disabilities, and there is a six-month waiting period before payments begin. Even then, the income received may not be enough to cover a mortgage, pay medical bills or meet other day-to-day needs. The average benefit paid by Social Security Disability Insurance (SSDI) is less than $1,400 a month. 3

Only 3% of disabling accidents and illnesses are work-related, so 97% of disability claims are not covered by workers’ compensation. 4

Workers’ compensation also provides disability benefits. However, not all employers are required to participate. An individual only qualifies for benefits if injured on the job or becomes seriously ill due to a work-related activity. Injuries or illnesses outside work are generally not covered under this program.

Most workplace policies are not portable, so you can’t take this coverage with you if you switch employers.

While you may have access to disability insurance through your job, these policies are designed for a wide range of applicants and may not have all the features and benefits you need. And the benefits from employer-paid plans are taxable, so they may only replace about 50% of your working income.5

It’s easy to see why you should consider the Group Disability Insurance designed for AIA members. It stands on its own and is flexible enough to be an extra safeguard for those who want more financial security.

As an AIA member, you’re eligible to apply quickly AIA Trust Group Disability Insurance underwritten by New York Life Insurance Company. Benefits of up to $6,000 a month6 are available, paid on top of any employer-provided disability coverage you might already have.

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Underwritten by New York Life Insurance Company, 51 Madison Avenue, New York, NY 10010 on Group Policy Form GMR.

1. 1. Source: Social Security Administration, https://www.ssa.gov/disabilityfacts/facts.html (viewed 1/14/25)
2. 2. Source: Council for Disability Awareness, https://disabilitycanhappen.org/overview/ (viewed 1/14/25)
3. 3. Source: Monthly Statistical Snapshot, Social Security Administration, June 2023
4. 4. Source Injuries, Illnesses, and Fatalities, U.S. Bureau of Labor Statistics, January 2022
5. 5. Source: Patient Advocate Foundation, https://www.patientadvocate.org/explore-our-resources/maintaining-employment-employment-benefits/long-term-disability-and-its-benefits/, as viewed, 1/31/23.
6. 6. Benefits under this policy combined with benefits from all other sources may not exceed 60% of your basic monthly pre-tax income.
7. 7. Including information on features, costs, eligibility, renewability, limitations and exclusions.