Is Disability Insurance More Important Than Dental and Vision?
In a search for voluntary benefits capable of winning the recruiting game, employers are often drawn to dental and vision benefits. They end up with a package that includes health insurance, a 401(k) plan, and decent dental and vision options. But what about disability insurance? Could it be more important than dental and vision?
Benefit Mall, a brokerage general agency, says that disability insurance has historically been subject to low enrollment rates. In many cases, enrollment rates have been so low for so long that employers simply stop offering the option. They see disability insurance as a waste of time and effort because their employees do not want it.
All that could be changing. Thanks to COVID and its impact on the way people live their lives, there seems to be increasing demand for disability benefits that can more than pay for themselves should long COVID keep a person out of work for months.
It Benefits Both Parties
Despite a higher demand for disability insurance among employees, employers still should not expect the vast majority of their workers to sign up for it. That is just the way voluntary benefits are. Nonetheless, there are things employers can do to encourage their workers to get on board.
Among them is illustrating to workers just how beneficial disability insurance can be. Using a realistic example of a worker who finds himself laid out by long COVID, employers can demonstrate how disability insurance can make up for lost income during that time. Compared to what employees pay for the benefits, disability’s pay off stands to be much larger.
Incidentally, disability insurance benefits employers, too. Rather than having to worry about how to help a disabled worker once vacation and sick time run out, the employer can rest easier knowing that disability insurance is there. Meanwhile, the employer can also be more comfortable about bringing in additional help until the affected worker is well enough to return.
Paying for Disability Benefits
BenefitMall suggests that it can be difficult to convince some workers just how valuable disability insurance is. Younger workers are more likely to pass for the simple fact that they do not expect to experience an injury or illness that keeps them out of work. One way around that is to pay a portion of the premium.
Voluntary benefits are somewhat unique in the sense that employers don’t have to contribute financially. They can pass the entire cost along to employees. But that is no way to encourage reluctant workers to get on board. So oftentimes, employers pay at least a portion of the cost. Paying more, or absorbing the cost entirely, is one way to get more younger workers to sign up.
Disability Does Not Discriminate
This entire discussion can be wrapped up in a simple statement: disability does not discriminate. Anyone can suffer a serious illness or injury that prevents going to work. And given that the average worker is just one illness or injury away from financial disaster, disability insurance appears more important than ever.
One could make the case that disability benefits are more important than vision and dental. How important is a matter of perspective. Nonetheless, COVID made it abundantly clear to the vast majority of American workers that not being able to work due to sickness can be financially devastating.
The good news is that short and long-term disability benefits do not have to be expensive. They can be as competitive as dental and vision plans. For that reason alone, benefits brokers and employers should give them a serious look.
