If you’re an employer or business owner with 51 or more employees who are full time or full time equivalent, you are required to provide group health insurance but not necessarily any other kind of group coverage.
However, supplying life and disability as well as options to include vision and dental insurance coverage can go a long way towards fostering a positive relationship with your employees, improving employee retention rate and reducing turnover, and ensuring that your employees stick around for the long term.
But unlike group health insurance plans, you as an employer are not legally required to purchase a group life and disability policy for your employees.
However, it can be an excellent benefit that draws high quality talent to your company; after all, the best talent tends to go with the companies that have the best benefits and culture.
What is Group Life and Disability Insurance?
Group disability insurance provides coverage for members of a group or organization (usually a company or labor union, but this may vary) who are unable to work for a period of time due to a disability.
This could be an injury or serious illness, or a number of other things that prevent an employee from working due to a physical problem or ailment.
Disability coverage is meant to replace lost income and wages for a limited period of time, and the benefits allowed by disability insurance typically max out at approximately sixty percent of the employee’s would-be earnings prior to needing disability.
As an employer, you can offer employees short-term and long-term disability coverage as part of their insurance benefits.
Life insurance is commonly offered by employers, while disability insurance is less common.
Both benefits, however, are usually bundled with a group health insurance plan when offered.
Like group disability and group health insurance, group life insurance spreads out the risk over a group of people (usually employees of a business or members of an organization like a union or other labor organization), making it more cost-effective for one policy to cover all members of the group.
If you employ disabled individuals, you may wish to consult your insurance agent about offering them life insurance for disabled persons.
Life insurance for disabled adults can be more complex but it is likely still possible to include in your group life insurance plan.
Why Do You Need to Provide Group Life and Disability Insurance?
You do not necessarily have to provide group life and disability insurance for your employees, but it can certainly be a nice benefit and most importantly help to attract higher levels of experienced talent to your company and help reduce turnover, which saves you money in hiring and training costs.
After all, the best people tend to go with the companies that provide the best benefits.
The peace of mind that comes from having disability coverage and life insurance can have a positive effect on your team; they’ll know they are protected if they are unable to work for health reasons and that their families will be taken care of in case the worst happens.
How Do You Choose the Right Type of Group Life & Disability Insurance?
Your insurance agent will be able to help you put together a package that can be bundled with your other business or commercial insurances.
Often, group life and disability insurance can be bundled with the group health insurance policy.
Keep in mind that group disability insurance typically covers short term disability and long term disability; however, you do want to check the policy or policies you are considering if you want to ensure that you offer both.
Short term disability is meant to cover you for a short illness or injury, and pays a percentage of your salary for that time. On the other hand, long term disability can cover you for a specified number of years all the way to retirement if needed.
How Much Does Group Life & Disability Insurance Cost?
The cost of group life and disability insurance depends on a number of factors, including the size of your company, what other types of insurance policies you are carrying, and more.
Your ASCO insurance team can help you figure out the best plan for your company and your employees’ needs.
What Other Types of Insurance Are Related to Group Life & Disability Insurance?
Group health insurance (including dental and vision) are often bundled with group life and disability insurance, along with other employee benefits.
Your insurance agent and benefits administrators can advise you as to the best combination of employee benefits for your company.
Contact ASCO Insurance specialists to learn about group life and disability insurance costs and a policy tailored to you.