Creating an inclusive workforce is good business. Companies that prioritize inclusivity benefit from stronger employee loyalty, diverse perspectives, and a more resilient workplace culture. Disability insurance plays a critical role in helping businesses support workers in an inclusive culture while safeguarding company operations.
What Is Disability Insurance?
As the name suggests, disability insurance provides partial wage replacement when an employee becomes disabled through injury or illness and is unable to work. Unlike workers’ compensation, it extends to non-work-related health conditions. This coverage allows employees to maintain financial stability during recovery periods, allowing them to focus on healing rather than the financial stress of lost income. By offering disability insurance, employers can help bridge the gap between health challenges and eventual return to work.
There are two basic types of disability insurance:
- Short-term disability: Most plans provide a percentage of the employee’s salary (up to 60% with a cap on payouts) for anywhere from nine to 52 weeks, depending on the plan. Benefits are generally paid after a waiting or elimination period, which is usually seven to 14 days. Many employees use their accrued sick time or personal time off (PTO) during the waiting period.
- Long-term disability: Picking up where short-term disability leaves off; long-term disability insurance provides approximately 50% to 60% of an employee’s base wages. Benefits are paid for the number of years specified in the plan. Some long-term disability plans pay benefits until the employee reaches a certain age, such as 65.
How Does Disability Insurance Promote Inclusivity?
Disability insurance is a tangible way for businesses to demonstrate their commitment to equity and compassion. Besides hiring diverse talent, inclusivity means creating a culture where employees of all abilities feel supported. Disability insurance contributes to this goal by:
- Removing barriers for employees with chronic conditions or unforeseen health challenges
- Promoting fairness by ensuring all employees, regardless of health status, have access to protection
- Encouraging long-term employment, as workers are more likely to remain with a company that accommodates their needs
How Does Disability Insurance Benefit Employers?
At first glance, disability insurance appears to be an employee benefit, but it also serves employers in several important ways.
Supporting Inclusivity and Retention
Businesses that provide disability coverage send a clear message that their employees matter, regardless of health challenges. Workers are more likely to remain loyal and engaged when they know their employers value their well-being. This is important in today’s competitive market, where retention can be as critical as recruitment.
Maintaining Productivity and Continuity
Disability insurance helps ensure financial stability for employees who may need to take extended leave. This reduces stress and allows them to return to work more prepared, which in turn helps the business maintain continuity and productivity.
Boosting Recruitment
While competitive salaries are important, the top talent today will seek comprehensive benefits packages. Offering disability insurance makes your business more attractive to workers who want assurance that their income is protected. Inclusive benefits can also help position your company as a supportive, forward-thinking workplace.
Speak with our knowledgeable agents at Safe Harbor Financial Services about adding disability insurance to your company’s group benefits package. We can help you find a plan that suits your business at the most affordable rates. Give us a call at (949) 973-4322.