Which Insurance Do Most Households Skip?

Households carry the insurance someone else requires and skip the insurance nobody asks about. Among 58,406 households who completed a Savology financial report card, 84.8% have health insurance and 71.9% have homeowners or renters coverage. Disability insurance reaches 29.3% (source: Savology platform data, August 2026). The pattern isn’t about which policy matters most. It’s about which ones arrive with a form to sign.

The coverage ladder

The top two have something in common that has nothing to do with risk. An employer enrolls you in health coverage during onboarding. A mortgage lender requires homeowners insurance before it will close, and a landlord often requires renters insurance before handing over keys.

Neither of those was really a decision. Somebody put a form in front of you and the coverage followed.

Everything below that line requires you to raise the subject yourself, and participation drops accordingly.

Why disability insurance is the one worth arguing about

For most working households, income is the asset. It funds the mortgage, the groceries, the retirement contributions, and the emergency fund. Every other financial plan in the house sits on top of it.

Disability insurance is the only product that protects that asset directly, and fewer than a third of households have it.

The usual objection is that disability feels unlikely, and the intuition behind that is wrong in a specific way. People picture a catastrophic accident. The claims that actually happen are far more ordinary: back injuries, joint problems, cancer treatment, complications from pregnancy, and mental health conditions. These are conditions that keep someone out of work for months, not forever, and months is long enough to do real damage to a household with three months of expenses saved.

It’s also worth knowing what you may already have, since it changes the size of the gap rather than closing it:

Social Security disability exists, but the standard is strict, it takes a long time, and it replaces a modest fraction of most incomes.

Employer short-term disability often covers a few weeks to a few months at partial pay. That is genuinely useful and it is not the same thing as long-term coverage.

Employer long-term disability, where offered, is the most common way households get this coverage. Two things to check: whether it covers your own occupation or any occupation, and whether the benefit is taxable. If your employer pays the premium, the benefit is usually taxable, which means a 60% benefit is closer to 45% in hand.

The two at the bottom of the table

Umbrella insurance at 12% is lower than it should be for a policy that costs relatively little. It extends liability coverage above what your auto and homeowners policies cap out at. If you have assets worth protecting, a teenage driver, a pool, or a dog, this is usually inexpensive relative to what it covers.

Long-term care at 2.1% deserves a fairer reading than the number suggests. This coverage is genuinely age-dependent, it’s expensive, and it’s a live debate among planners about who should buy it and when. A low number among a population that skews younger is not by itself alarming. It’s still a small number by any reading.

How to think about the order

Insurance is one of the few subjects where the right answer is often “less than you’d think, but not zero.”

1. Health coverage, which most people already have.
2. Property coverage for where you live, which most people already have.
3. Disability coverage if you work for a living and your household depends on that income. Start by finding out exactly what your employer provides, because that determines whether you need to buy anything at all.
4. Term life if someone depends on your income. About 42% of the households with children in this data have none, which is a large gap in a group where the need is clear.
5. Umbrella once you have assets or liability exposure worth protecting.

Notice what isn’t on that list: anything sold primarily as an investment. Insurance is for risks that would break your household’s finances. Products that blend insurance with investing can make sense in specific situations, but they aren’t the starting point, and they aren’t what the gaps above are about.

The pattern worth taking away

Households don’t underinsure because they’ve weighed the risk and accepted it. They underinsure because nobody handed them a form.

The coverage that reaches almost everyone is the coverage an employer or a lender arranged. The coverage that protects the paycheck, the thing every other financial goal depends on, is the coverage you have to go find. That’s the whole explanation for the shape of the table above, and it’s the reason a periodic review of what you actually carry is worth an hour of your time.