It helps companies retain skilled employees.
According to a 2017 report by the Society for Human Resource Management (SHRM), nearly one third of organizations increased their benefit offerings over the past 12 months. The leading reason was to remain competitive in the talent marketplace.1
Here is why disability insurance is so important:
Without it, the effects can be devastating. According to a 2017 CareerBuilder survey,2 nearly eight out of ten Americans are living paycheck to paycheck. By offering disability insurance, you can avoid having the heart-breaking conversation about what to do after paid leave or sick leave ends (if it is even available).
It’s the foundation of your employees’ financial security. Without income protection, an employee may not be able to pay their mortgage, their phone bill or contribute to their health insurance or retirement plans should a pregnancy, illness, or injury take them out of work for a few days, weeks, or more.
It retains talent. Not only does short- and long-term disability insurance help people feel more secure and loyal to their jobs, your employees are also more likely to return to work if they have this coverage. SHRM estimates that replacing an employee can cost 60 percent of their annual salary3 — so retention has a major impact on the bottom line.
It’s very affordable compared to other forms of insurance. Data from the Bureau of Labor Statistics shows the average cost of providing both long-term and short-term disability coverage in 2016 was approximately 10 cents per hours worked, or $205 per year. In contrast, the average employer contribution to health insurance averaged $2.86 per hour worked, or $5,725 per year.4
It’s a family-friendly benefit. Short-term plans typically cover two weeks before and six weeks after a routine pregnancy. Unless you’re one of the few employers who offer paid family leave, disability insurance is a critical financial benefit for women in the workforce.
Take the next step
Talk to your benefits consultant or broker about your options to make disability insurance part of your overall compensation plan. You can also contact one of our member companies. There are plans that fit all budget sizes. And, if your company can’t afford to fund a plan, you can still offer plans that are completely employee paid. These are more affordable to employees than individual plans.
Educate your employees about disability insurance as part of your financial wellness initiatives. Many people remain unfamiliar with disability coverage despite the increasing need for its protection. Workers will appreciate knowing they have a financial safety net.