Plenty of high income baby boomers do without disability insurance because they think theyre made of steel.
But what about Bonnie Boomer, a hypothetical 45-year-old business owner and mom who always keeps an umbrella in her car, stores 6 weeks of emergency supplies in her pantry, contributes as much as she can to her 401(k) plan and buys all of the disability insurance she can get?
Disability insurers usually limit benefits to 60% of the insureds gross income, to give insureds who are less conscientious than Bonnie a financial incentive to return to work.
Some insurers are helping insureds fill the gap by offering extra features that can increase insureds quality of life without putting incentive-killing cash in their bank accounts.
Some of the most common gap fillers are extra education benefits for the insureds children and benefits that keep up a claimants retirement plan contributions.
The features address 2 of nervous boomers most overwhelming fears: the possibility they might let their children slide into poverty, and the possibility they and their spouses might live out their retirement years in poverty.
Benefits to help children stay in college or in private elementary schools or high schools seem to be more common in accidental death policies than in comprehensive disability insurance policies.
But Principal Financial Group Inc., Des Moines, is an example of an insurer that has offered dependent education benefits together with comprehensive group long term disability insurance.
Insurers that offer 401(k) contribution replacement benefits through annuity riders or basic policy provisions include companies such as Massachusetts Mutual Life Insurance Company, Springfield, Mass., and Guardian Life Insurance Company of America, New York.
Some disability insurance experts are skeptical about the idea of marketing special disability benefits at a time when most boomers lack adequate disability benefits of any kind.