Group Disability Insurance
Help Your Employees with Group Disability Insurance
Life's uncertainties can include unexpected challenges, such as a sudden health issue, which can significantly impact your or your employees’ financial stability. At AEIS, we understand that unforeseen events can happen to anyone at any time, and the unfortunate truth is that most people would be devastated from a financial perspective if they had to deal with a sudden, moderate-to-severe medical issue. In fact, that's a big part of what
group disability insurance is designed to protect. It gives coverage if an injury or illness stops someone from working, giving them the time they need to get back to good health as soon as possible. Colloquially within the industry, it is known as “paycheck insurance” since it replaces a portion of your employee’s income. We always ask employers, “Would you rather only send a get well card to your employee or a thoughtful card along with a financial safety net in the form of a check?”
Different Types of Disability Insurance
Short-Term Disability Insurance
As the name implies, short-term disability insurance offers coverage with the understanding that the situation an employee finds themselves in is temporary. This is typically any period that lasts between nine and 52 weeks. Most of the time, between 50% and 60% of someone's wages will be covered.
Long-Term Disability Insurance
Long-term disability insurance provides coverage for extended periods, spanning from several years to an individual's Social Security Normal Retirement Age (SSNRA). This type of insurance is designed for situations where a person sustains an injury, and a full recovery is unlikely.
How Does Group Disability Insurance Work?
In terms of how group disability insurance operates, employees will file claims depending on exactly what type of "disability" they are experiencing. Short-term claims are typically reserved for people who get pregnant, or suffer from injuries like joint disorders or even digestive issues and are unable to work. Long-term situations would involve permanent back injuries or a diagnosis of something like cardiovascular disease or cancer.
Once approved, employees would begin receiving short-term benefits for the duration of the benefit period or until they return to work. For long-term claims, benefits can potentially continue to be received until they reach proper retirement age. It's worth noting that many long-term disability policies incorporate a pre-existing condition clause, barring the carrier from disbursing payments for such conditions during a specified period—for example, such as 3 months before and 12 months after the initial coverage date.
Every disability contract varies and the duration, what illnesses/injuries are covered, and other essential policy details may differ.
The importance of policy reviews:
Build a Custom Benefits Package with AEIS
A critical thing to understand about all of this is that every workforce is unique. As group disability insurance is designed to protect your workforce, you need to start with their needs and work your way back to the type of policy that meets them.
That is to say, don't assume that there is a "one size fits all" approach to group disability insurance. Certain jobs are inherently more dangerous than others and the coverage you offer should reflect that. This is also why it's so important to partner with insurance and benefits professionals like those at AEIS - we can help you understand all options, coming up with the competitive package you need in the most efficient way possible.
If you'd like to find out more information about what you need to be looking for in terms of group disability insurance or to put together the type of custom benefits package that will help your organization remain competitive, please don't delay -
contact AEIS today.
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