Disability income insurance is one of the most unappreciated of employee benefits.

Activists don’t cry for broader disability coverage and there aren’t any public service announcements or massive media campaigns to put a spotlight on the need for income protection.

But the news of the U.S. full year savings rate dropping into negative territory in 2005 for the first time since the Great Depression is just one sign of how close debt-ridden Americans are to financial distress and why disability insurance is more important now than ever before.

Excluding mortgage debt, American consumers now owe an average of $11,669, up 13% from 2004, according to the credit-rating firm Experian Information Solutions Inc., Costa Mesa, Calif. Living paycheck to paycheck has become a way of life for many, and affluent families are not exempt from our lifestyle of conspicuous consumption.

A recent Wall Street Journal article asserted that while employees have greater income, the share of their money that is devoted to transportation and housing has increased dramatically over the years. According to the article, more than 52% of U.S. household expenditures are going to basics such as shelter and transportation, up from less than 41% in 1950–not to mention the escalating cost of college education and mounting credit card debt.

Workers tend to put whatever spare change they can find toward the cost of rising health insurance premiums. In the event of a serious illness or injury, they reason, at least their hospital bills will be covered. But who will pay their mortgages, car payments and children’s college tuition fees?

Disability income insurance should be a cornerstone of the financial protection package, but despite the obvious need for income protection, disability insurance is one of the less frequently offered benefits. Fewer than half of workers nationwide can get either short-term (40%) or long-term (30%) disability insurance through the workplace, according to the U.S. Bureau of Labor Statistics.

While practically all large companies–those with at least 5,000 workers–offer disability coverage, fewer than half of firms with 100 workers or less do, according to LIMRA International, Windsor, Conn.

The reasons for lack of disability coverage vary. Many employers think they can’t afford to offer disability insurance, especially during this era of sharply rising costs for meat-and-potatoes benefits like health insurance and retirement plans. Others simply don’t believe their employees would be interested.

What’s more, disability insurance is a complex product. Many employees don’t understand it. Often people are skeptical of insurance. After all, it’s not something you can hold in your hands–just a promise made on paper.

Others overestimate benefits that they will receive from workers’ compensation or Social Security in the event of a disability. What they probably don’t realize is more than half of claims are denied on the first application, according to data from the Social Security Administration. Those that do succeed often yield benefits that are too low to support a significant portion of a worker’s income.

Human resource professionals often don’t have time to try to generate enthusiasm for a product that forces people to think about how they would cope with a debilitating illness or accident.

Yet disability income insurance is vital to the economic interests of individuals, employers and society at large.

In any given year, one out of every eight people is likely to become disabled, according to the Society of Actuaries, Schaumburg, Ill. Compare that to the odds of having a serious auto accident (1 in 70 autos), experiencing a home fire (1 in 88 homes) or dying (1 in 106 people). Between the ages of 35 and 65, seven out of 10 people will become disabled for three months or longer, according to a 1998 Senate Finance Committee Report. Disability is 16 times more likely than death to cause home foreclosure, according to the Federal Housing Administration.

Disability insurance typically replaces 60% of an injured employee’s income. That’s enough to cover basic expenses, such as a mortgage, but not so much that a worker would be tempted to stay away from work indefinitely. And higher income earners will want to consider purchasing products that allow them to supplement their basic plans.

The workplace is an ideal platform from which to communicate the importance of income protection. Disability insurance gains credibility in the eyes of employees when it is offered in the benefit plan. Brokers face tremendous challenges in today’s market for employee benefit products, but the need for disability insurance has never been greater as more workers live from paycheck to paycheck.

Brokers may find the following tips useful in talking with clients and prospects about offering group disability insurance products in the employee benefit plan:

1. Share the facts. Do a simple risk assessment based on the firm’s demographics to show what’s at stake in terms of lost income for employees and lost productivity for the company. Explain how a smartly structured disability plan fosters a return-to-work mentality among employees–and what it’s worth to get people back on the job quickly. Also consider that an employee’s need to be out of work can result from family stress or other issues, so look for plans that offer integrated employee assistance programs.

2. Share the options. The number of disability insurance products has exploded in recent years to meet the needs of a diverse work force. Firms that can’t afford coverage still can leverage their size to offer it to employees at a significant discount on a voluntary basis. Employers that want to maintain current coverage levels but can’t afford to sweeten the benefit may consider giving employees a “buy-up” option. Buy-ups may allow workers to customize details such as a benefit maximum, duration and elimination period in order to best meet their needs. Workers may also be able to add options such as a cost-of-living adjustment. Payroll deduction is usually available; be sure your clients know about it and other options such as credit cards or direct bank withdrawals.

3. Share your resources. Everyone wants advice from an expert, particularly when it comes to a product as personal–and as complex–as insurance. Offer to conduct on-site meetings to explain disability insurance to workers. Put educational materials and calculators on your Website. The more interactive tools you can offer the better.

4. Share your time. Be there during open enrollment to help workers understand the risks and make the right decisions. Explain how disability insurance fits in with and complements other benefits in the company plan, such as sick leave, workers’ compensation, health insurance and retirement savings plans. Be willing to answer claims questions. The more one-on-one service you can offer, as time-consuming as that may be, the more success you will enjoy. Human resource departments will begin to see you as part of their team and invite you back again.

Promoting disability income protection may not be a glamorous cause or gain a lot of media attention, but brokers who care about the needs of American businesses and workers can make a difference. It’s good for the economy, for workers and businesses, and for brokers, too.