No one expects to suffer from a debilitating injury and lose their ability to work and cover daily expenses – but it happens. With Disability Insurance, you can give your employees and their families peace of mind in knowing that they won’t lose everything when something unplanned happens.

If an illness or injury puts you or one of your employees out of work, Disability Insurance ensures a continued source of income.

There’s typically two types of group disability insurance.

Short Term Disability:  Pays 80% of gross income for 60-180 days.

Short-term disability benefits are typically paid from three to six months after an accident or illness that makes an employee unable to work. Long-term disability benefits can be extended for years, however they won’t apply once the policyholder retires or reaches age 65. This type of insurance offers an important benefit if your business employs female employees of childbearing age: paid maternity benefits. Short-term disability covers normal childbirth, ensuring that your employees will be partially compensated while they are on leave.

Long Term Disability:  Pays 60% of gross income for more than 180 days.

Disability Insurance covers a portion of an employee’s income when they lose their ability to work due to a non work-related illness or injury. There are two types: short-term and long-term disability plans. Employers can offer either or both depending on their needs.

Short-term disability covers a portion of the policyholder’s salary for a short period, which can vary depending on the policy. However, it’s usually covered for three to six months after the incident that left them disabled.

Long-term disability usually comes into play when the employee holding the policy is disabled to the point of being unable to work for at least six months. It can be extended for years, even until the policyholder retires or reaches the age of 65, in which case benefits will end.

Many business types should consider disability insurance particularly important. Physician disability insurance, for example, is important for healthcare professionals who recognize the difficulties that disabilities can impose on an individual. Disability insurance for self employed contractors is also a good idea, considering the many dangers that exist in contracting work.

Many policies also cover rehabilitation costs that help employees transition back into work faster.

The cost of both long-term and short-term Disability Insurance usually falls between 0.25 and 0.5 percent of total compensation for companies of all sizes.  Offering this type of benefit is important for retention purposes, as rates for group plans are generally less expensive than individually-purchased policies. There’s also the benefit to the business of getting employees back to work as quickly as possible.

If you’re unable to provide and pay for group Disability Insurance to all of your employees, offering voluntary employee-paid coverage is an option that should be considered.