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Why Gen Y Should Care About Privatizing Income Protection

If there is anything that we’ve learned about the millennials, it’s that they do not play by the old rules.

Millennials have different priorities for what they want out of their work and their lives. They want to believe in a cause and make a tangible difference. They believe money is important, but they believe having an impact is just as important, if not more so. Millennials have grown up in a time when the old models of working for the same company from graduation to retirement don’t hold up anymore.

Instead, millennials are known for frequent job changes, thinking of their work as fundamentally temporary. Millennials are also more entrepreneurial than any other generation in the current workforce. The problem is that employer group income protection insurance plans are especially ill-fitting for this lifestyle. What happens to their group insurance plans when they decide to join another company, or if they quit in order to work for themselves?


Individual vs. Group Disability Insurance

Individual disability insurance plans have two great features that make them ideal for millennials: They are portable, and they provide comprehensive 24/7 coverage. Insureds own their policy and they can take it wherever they go. It is not beholden to any particular employer, any particular doctor or even any particular treatment. Individual plans put the insured in control.

As a recovering quadriplegic, when I decided to start rehabilitation after my accident, I looked into the rehabilitation provision on my medical insurance plan. The plan had a maximum benefit payment cap of $10,000 with a 50 percent copay, and I qualified for one 50-minute outpatient session a week. There was absolutely no way that level of medical care would be enough.

Luckily, my individual disability insurance benefits provided me some much-needed choice and control. Instead of mandating a certain amount and duration of physical therapy, my disability insurance plan paid me cash that I could use at my own discretion. I hired both an occupational therapist and a physical therapist. They came to my house for two hours a day, five days a week, for more than a year. That was the level of care I needed to give myself the best chance to maximize my recovery. I never would have received this type of care without my individual disability insurance benefits.


Who Needs Long-Term Care Insurance?

I cannot put enough emphasis on the importance of intensive, long-term rehabilitative care. It was the difference between surviving and living. I had a neighbor with an injury similar to mine. However, unlike me, he was never able to obtain the rehabilitation he needed and instead spent 20 years in bed being cared for by his family. He admitted to me that every day he prayed that he wouldn’t wake up the next morning. He was tired of suffering and seeing his loved ones suffer as they cared for his every need.

If your clients do not protect their ability to do the things that they love, what do they have left? Too often, younger people fall into a pattern of thinking of themselves and their bodies as invincible. We expect our cars will wear out. We expect our homes might be flooded or catch fire. We understand objects that are important to us need to be protected, but for some reason, that understanding rarely extends to our bodies.

Many Americans are planning to work into their late 60s or early 70s. Can your clients really say that over the course of 40 or 50 years, their bodies will never suffer some sort of accident or illness?


Protect Clients’ Most Valuable Asset, Their Ability to Work

For many people, individual disability insurance can seem like an unnecessary expense. However, it makes more sense to invest a little bit of their current income to protect their capability, the skills and talents that allow them to earn an income and live out their goals and dreams.

Twenty-one percent of young adults reported on a LearnVest survey that they don’t have disability insurance because their jobs aren’t physical. Nevertheless, skills and talents are about more than just our physical bodies. Even if your clients have white-collar jobs with no physical requirements, they need to protect against the loss of energy and mental acuity that so often comes from an accident or illness. And if their human capital isn’t valuable enough, what about their dignity and independence?


Improve Future Financial Stability

It’s undeniably true that young people carry more debt than older generations, and it’s understandable for them to feel cash-strapped. But the simple fact is that there is always a way to get what you need and there is always an excuse not to do something. Disability insurance is not a “nice to have,” it’s a must-have!

Disability insurance offers a steady and consistent stream of income if your clients are unable to work due to a sickness or accident. Disability insurance protects their ability to have and maintain their lifestyles, their relationships, their material possessions and their financial well-being. In addition, it preserves their self-reliance, choice, control, recovery and their dreams for the future.


John F. Nichols, MSM, CLU, is a nationally recognized disability benefits consultant with Disability Resource Group. As a life and qualifying MDRT member, John has two Court of the Table and nine Top of the Table qualifications. John may be contacted at

John F. Nichols, CLU, MSM is Founder of Disability Resource Group Inc., a provider of disability products and services. He serves as NAIFA Secretary and is a Life and Qualifying MDRT member with two Court of the Table and four Top of the Table honors.

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