Articles
Disability Insurance: Protecting Your Employees Helps Protect Your Business

As an employer, you watch your company’s workers struggle with challenges not only on the job, but off the job too. You probably have procedures in place to help with their workplace concerns, but you may sometimes wonder what you can do to help them overcome personal challenges.

Did you know that one of the most meaningful things you can do for your employees is provide a robust benefits package? It’s true: 38 percent of workers surveyed as part of Aflac’s 2013 WorkForces Report1 said employers signal they care about their employees’ well-being by offering strong benefits. What’s more, 44 percent of workers who don’t believe their companies take care of employees told Aflac they are at least somewhat likely to leave their jobs in the next year, compared to 8 percent of those who at least somewhat agree their employers take care of employees.

With those thoughts in mind, now might be the right time to consider adding disability insurance to your benefits portfolio. After all, May is Disability Insurance Awareness Month and media coverage could bring thoughts of illness and injury – as well the costs that accompany them – to the forefront of your workers’ minds.

You may be wondering why an entire month is devoted to disability insurance awareness. Here are a few reasons:

  • The Social Security Administration estimates that slightly more than 25 percent of 20-year-olds will become disabled before reaching age 67.
  • A mere 31 percent of U.S. workers have some type of disability insurance, and half of those believe they need more coverage.2
  • Just 4 percent of workers surveyed by the Life Insurance Market Research Association said they’d been approached about disability insurance in their workplaces in the past two years.
  • Employer-provided disability insurance prevents as many as 575,000 families each year from slipping into poverty levels and saves the government and taxpayers up to $4.5 billion annually.3
Physically disabled, financially enabled

What protection does disability insurance extend to workers? Consider this: Disability coverage protects employees’ most valuable asset, the ability to earn a living. Without regular paychecks, many would find it difficult – if not impossible – to keep up with the mortgage, car and credit card payments; utility bills; education costs and grocery bills.

Insurers receive hundreds of letters each year from policyholders who’ve discovered just how quickly their financial outlook can change as a result of an accident or illness. Here’s what Louise, who suffered a stroke and was told her healing process could take three to six months, had to say:

I was told I needed to eliminate all the stress I could and concentrate on therapy and healing. There are two reasons I was able to do this … a full sick bank and my short-term disability policy. I sometimes thought, “I can’t afford to have any more deductions taken from my check,” but I have a completely different attitude now. Now I know I can’t afford not to have them taken out!

I would have never believed I’d have a stroke, but being prepared for the unexpected made a tremendous difference to me and my family. It was the difference between making it and being financially devastated by this medical event.

Benefits for your employees, benefits for your company

Workers are indeed fortunate to have caring employers who are willing to go the extra mile by adding disability insurance to their benefits portfolios. After all, Americans’ track record when it comes to saving money isn’t exactly stellar: Half of all households are “financially fragile.”4

You may be thinking that the Social Security Administration will step in with financial assistance if an employee is sick or hurt, but it’s important to note than more than 45 percent of those who apply for government benefits are denied payments. Workers’ compensation isn’t the answer, either: Off-the-job injuries are three times more common than on-the-job injuries, but they aren’t covered by workers’ compensation plans.5

The good news is that you can help protect your employees’ financial security by offering either group or individual disability insurance, and it doesn’t have to increase your benefits costs at all. By adding an employee-paid voluntary disability plan to your benefits portfolio, you can give workers the protection they need with no direct effect on your company’s bottom line.

What’s more, by doing the right thing for your employees, you’ll also be doing the right thing for your business: Workers surveyed as part of the 2013 Aflac WorkForces Report told us that a strong benefits package increases their company loyalty, productivity and job satisfaction – and also plays a major role when they’re deciding whether to remain in their current jobs or move on to jobs with better benefits.

To learn more about how voluntary disability insurance coverage can benefit you and your employees, go to http://www.aflac.com/business/short_term_disability_insurance.aspx.

1The 2013 Aflac Workforces Report, a study conducted by Research Now on behalf of Aflac, January 2013, accessed May 14, 2013
2LIMRA and LIFE Foundation Insurance Barometer Study 2012, Workplace Attracts Double the Number of Disability Insurance Shoppers as Traditional Shopping Methods, accessed May 14, 2013
3Charles River Associates, Financial Security for Working Americans: An Economic Analysis of Insurance Products in Workplace Benefits, accessed May 14, 2013
4Financially Fragile Households: Evidence and Implications, National Bureau of Economic Research Working Paper 17072, accessed May 14, 2013
5National Council on Safety Injury Facts 2011, accessed May 14, 2013