The Council for Disability Awareness released the findings from its 2012 CDA Long Term Disability Claims Review, a summary of LTD claims from 2007 – 2011. There’s always some nugget in the survey that we find of interest. This year we learned that the industry paid some $93 Billion in claims in 2011 by the companies who participated in the survey – a 2% increase over 2010.
Nearly half of the companies reported increased claims, with a third reporting flat and 19% reporting less claims. In 2010, more than half of the companies reported an increase in claims. The overall sense is that the economy is driving the increase in the number of claims.
We think it’s not that simple – because later in the report it is noted that the biggest increase in claims came from Baby Boomers, aged 60 and up. Some of this is statistically-driven – Baby Boomers continue to represent a large bump in the American working population. It is also a factor of aging – as claims for arthritis, spinal disorders, orthopedic back problems, sciatica and osteoporosis represented 30.5 percent of disability claims in 2011 – most, but not all, are related to the aging process.
Another interesting fact – less people own disability insurance policies. This is the third straight year that the number of workers with LTD insurance has declined. We think that’s a function of a few elements – fewer workers are able or willing to purchase insurance policies , there are fewer insurance companies writing disability insurance policies, and it is also possible that the new policies are perceived as being of low value and not worth the investment.
To dig into the survey further, visit the Council for Disability Awareness