4 myths about disability insurance
Last updated April 24, 2026
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Are you underestimating your chances of income loss?
Income is essential to a household's financial security. But while we don’t think twice about buying insurance to protect our health, homes, and cars, we don’t tend to protect our incomes — through disability insurance — at the same rate. Read on to discover some common myths and misconceptions around disability insurance so you can better protect yourself and your family.
Myth 1: It won't happen to me
Many individuals underestimate their chances of being out of work as the result of a serious injury or illness. The mindset that “it can’t happen to me” creates a false sense of security and lessens the perceived need for protection. Unfortunately, the chances of needing disability insurance are much greater than most people realize. In fact, Americans are five times more likely to become disabled than die in a given year, but they are more financially prepared for death than they are for a potential disability.1
Another incorrect assumption: people tend to believe that serious injuries or illnesses are most common among people who are older, male, and work in hazardous professions like construction. The notion that disabilities are more likely to occur among certain groups of people who are “not like me” reinforces the myth.
The truth is that people of all ages, demographics, and professions have roughly the same potential to experience an income-disrupting injury or illness. In fact, 1 in 4 of today's 20-year-olds can expect to be out of work for at least a year because of a disabling condition before they retire.2
Myth 2: Disabilities happen at work
Many working adults believe that disabling accidents are generally job-related and, therefore, covered by workers’ compensation or Social Security Disability Insurance (SSDI). However, only 15% of medically consulted injuries occur at work — and therefore, most injuries are not covered by workers’ comp.3 In addition, the set of qualifications to be approved for SSDI are much higher than many people realize, and many disabilities that would be payable through the disability insurance you get through work would not be approved for SSDI.
Myth 3: Disabilities are catastrophic
What qualifies as a disability? More than you might think. Many people incorrectly believe the term applies only to catastrophic conditions like paralysis from a car accident or a debilitating stroke. Many do not realize that disabilities are typically the result of less severe injuries and more common conditions such as pregnancy, back pain, depression, and digestive disorders.
As mental wellness declines, mental health conditions now account for roughly 7–10% of disability claims — up from about 4% in the early 2000s.⁴
Myth 4: “Disability insurance” is for individuals with disabilities
The term "disability insurance" is confusing to many and, arguably, inaccurate. The name conjures up images of permanent, life-altering disabilities rather than less serious injuries and treatable illnesses. But disability insurance is really just another way of saying “income replacement,” and that’s exactly what it does: disability insurance provides income replacement for several months or years for a wide array of conditions and medical events. For example, at 30%, maternity is the most common reason for short-term disability insurance claims.5 Confusion caused by the name contributes to lower interest and ownership relative to other forms of insurance.
Hopefully, this information was useful to help you overcome some of the most common misunderstandings about disability insurance. Click here to read more.