May is Disability Insurance Awareness Month. Every year, The Council for Disability Awareness joins forces with others in the insurance industry to raise awareness about the importance of income protection.
The reality is this – an illness or injury can happen to anyone. Disability insurance provides critical financial protection that is very different from other insurance products. Unless it is offered through their employer, most adults have little, if any, disability insurance coverage, and many don’t fully understand what it protects.
Disability insurance pays a portion of the insured employee’s salary when the employee needs to miss work due to an illness, injury, or having a baby. For a single employee, disability insurance is the second most important insurance the employee can carry after health insurance. And for an employee with a family, disability insurance provides an income stream if the employee needs to leave work.
What is group disability insurance?
Group disability insurance provides income protection for employees as well as cost-saving management strategies for employers. For employers, lost time on the job due to a disability can significantly impact workplace productivity and profitability. However, disability insurance provides partial replacement of lost income for employees while also covering overtime and costs of hiring replacements. Many states mandate temporary disability insurance that requires employers to provide benefits equivalent those working in non-statutory states.
Is group disability insurance really necessary?
Lost time and medical costs are on the rise, and the risk of disability is greater than most employers and employees realize. Consider these statistics:
The possibility of becoming disabled is very real for working Americans, and so are the financial consequences and costs associated with employee absence.