Importance of disability benefits often overlooked

Of the variety of benefits offered by employers, workers often focus on the perks that will help them start saving for retirement or will protect their families. But what about injury or disability? This type of coverage is often overlooked by people signing up for their company's offerings. Although the thought of a serious accident that affects one's work can be uncomfortable to discuss, it's an important topic for businesses to make their workers aware of.

Importance of long-term disability
Today, 14 million people are on federal disability, according to NPR. The majority do not work. Keeping this statistic in mind, employer-sponsored long-term disability coverage is becoming more important within the workforce. Without it, workers who suffer from an impairment that affects major life activities may have to remove themselves from employment.

According to a survey conducted by the Consumer Federation of America, 55 percent of companies offer LTD benefits to reduce company costs if an employee goes on disability. With the passing of the Americans with Disabilities Act in 1990, which prohibits discrimination based on disability, employers have used LTD offers to keep employees on the payroll during a strenuous time.

Of the employers that don't offer LTD benefits, the reason for the lack of coverage often comes back to an overestimation of the cost for the company. In fact, the CFA survey found 42 percent of businesses believed the price of LTD insurance would be $30 or more for each employee. Upon further research into industry data, CFA confirmed the cost would be somewhere around $20 to $30.

Meanwhile, half of employers studied by the CFA believed offering LTD coverage increases workplace productivity and gets employees back on the job faster following a debilitating incident.

Benefits for employers
LTD insurance offers advantages for employers in addition to their workers. Offering this type of coverage can differentiate one company from another, making a business more attractive to potential employees.

LTD benefits also help businesses retain employees, as the notion of an employer "having your back" makes workers more willing to stay with a company for a longer period of time, according to Benefits Pro. A disability can be a devastating injury for an employee. Without LTD insurance, the worker may be unable to continue working. This coverage shows a business is dedicated to a person's health and well-being and that the employee is a valued member of the company community.

Next steps for your company
While LTD benefits could be an important addition to your company's insurance policy, it could also increase the cost for employees. Before adding LTD coverage, human resources should poll workers about their opinions. If your business decides to add LTD insurance, it's important to decide if the update will be mandatory or voluntary. A voluntary benefit could result in employees paying for the full cost, according to Forbes. Either way, keep employees informed of any upcoming changes to your company's policy and the coverage they receive. Make sure you detail the benefits associated with the extra coverage, as well as how it directly affects your workers.

Although LTD coverage can often be an afterthought for many employers, it is an important worker benefit to discuss and potentially offer. Along with the added advantage of employee retention, LTD insurance will help workers continue to provide for their families after a life-altering injury.