Bill is 50-year-old department manager for a mid-sized manufacturer. Even though he has never been seriously ill and has a clean family health history, he was recently told that he has cancer.
While the treatment will be long and difficult, Bill can take comfort in knowing that his employer-sponsored health insurance will pay most of his hospital and physician costs.
But Bill is about to be blindsided for a second time when he realizes that he will have no income to help support his family as he recovers from the difficult medical treatments.
Disability Insurance Myths - An Employee’s Perspective
During the working years, an employee is over three times more likely to be disabled than to die. At Bill’s age, the odds are still 1.8 to 1 in favor of a disability. In fact, thanks to advances in medical treatments over the last twenty years, deaths from the major illnesses (cancer, stroke, and heart disease) are down nearly one third, while disabilities from these same diseases are up by over 50%!
Yet Bill, like many workers, is only protected against the lesser risk.
Based on these statistics, you would think that every employee would ensure that he has disability insurance coverage. Unfortunately, many of today’s workers do not see the necessity for this insurance because, like Bill, they have been lulled into a false sense of security by a lifetime‘s worth of good health or the naive belief that unforeseen illnesses and accidents happen only to the unlucky few.
Disability Insurance Considerations From an Employer’s Perspective
Unlike the readily understandable benefits like paid vacation or health and dental insurance, disability income insurance can be more difficult to use as an incentive for workers to remain loyal, yet in time of need it will be the most appreciated part of the benefit package. Workers of all ages (yes, even those young employees who believe they are invincible) need protection from those surprises that can neither be predicted nor prevented. Disability Insurance is a benefit that a caring employer can provide, even if it is never needed, and it will engender a sense of loyalty when it is established with a thorough explanation.
2 Types of Disability Insurance
There are two basic types of disability insurance: short term (STD) and long term (LTD), neither of which should put an undo strain on a company’s budget. Employers have the option of adjusting the waiting period (the interval from the injury or illness to the start of payments) and the benefit period (the maximum amount of time for which the worker will receive payments).
In the case of STD the waiting period is generally up to two weeks, while the benefit period can be as little as thirteen weeks or as much as two years. With LTD the waiting period ranges from six months to two years, and the benefit period would last from a few years to a lifetime.
Employers also have the flexibility to require employees to contribute a portion of the premium, or they may choose to pay the entire amount themselves. There are a variety of paths that an employer can take to establishing a plan that fits the company’s budget and, at the same time, addresses the potential needs of the workers.
Disability Insurance - Putting it all Together
There is little doubt that disability insurance has advantages for both your employees and your company. Consider these:
- Group rates are lower than individual rates and, with the option of employee contributions, a plan can be established at a reasonable cost
- There are no medical exams, so all of your employees are automatically covered regardless of medical history
- Those valued employees who become temporarily disabled return to the company with a sense of loyalty and gratitude
- Waiting and benefit periods can be adjusted, which gives your business flexibility in designing a plan
- Hiring managers can use this benefit as a recruiting tool for inducing new talent to the company
Get the Right Disability Insurance Coverage
To learn more about your disability insurance options, give us a call at (800) 947-1270 or (610) 775-3848, or click here to contact us. We offer health and disability insurance protection from multiple competing insurance providers, so unlike single-brand companies, we're free to shop around to find the best deal on quality insurance protection. Contact us today to get started.
