Global insurance provider CIGNA teamed up with consumer research company Yankelovich to study employee opinions about long term disability (LTD) coverage. They learned that 94 percent of respondents thought it would be valuable to have disability insurance that covered part of the pay that would be lost in the event of extended time away from work due to illness or injury.
Employees can purchase this coverage on their own with a variety of types of individual policies available from brokers and financial professionals. Group coverage through an employer is likely to be cheaper and the majority of poll participants, 43 percent said they would rather receive advice about disability insurance through their employer.
You could be a total hero and provide and pay for Long Term Disability coverage. Or you can offer the plans through payroll deduction and allow employees to foot the bill. A potential tax advantage when employees pay the cost of LTD and group rates and assistance and education from a provider will make the benefit more attractive.
Whatever you choose it is essential to educate employees about the options avoiding a presentation or materials laden with benefit buzz words. The importance of LTD can be illustrated by examples that describe the “what ifs” in the event of an extended absence. Make certain that the presentation whether it is in print, online or in person, is tailored to the audience.
Effective LTD programs encourage employees to return to work and not linger at home collecting fat checks. They replace only a portion of regular earnings and may include the requirement that the individual accept a similar position, if it is available.
When an employee is out of work on LTD consistent contact from the company can help to speed up a return to work. Phone calls to check in will keep the employer in mind and demonstrate concern. If appropriate and available, reduced schedules may facilitate the transition to the workplace after an extended absence.
Clarifying LTD misconceptions is essential. CIGNA found that 62 percent of people surveyed said they had disability coverage, a stark contrast to the 31 percent of private sector employers who actually provide access to LTD insurance.
Long Term Disability could be a positive addition to benefits that provide economic security. Investigate the options and think about whether they fit into your benefits offerings and could be good news during the next open enrollment or offered as a mid-year enhancement.