Long term disability insurance is the income substitution process through which you can keep your earning sources alive even if you go through disability. Insurance provides income to workers whose incomes are interrupted by lengthy periods of disability. Usually the benefits are paid until retirement or till the time policy holder is not fit enough to get back to his work.
Long term disability financed by employer is mostly available to full time workers or as per the risk and labor involved in the profession. Long term group disability insurance is also provided from the employer side to protect the finances of their employees if they face a serious injury or illness.
- Many employers or private businesses offer long term disability plans to their employees as part of larger benefits scheme so that the employee remains tension free about the future uncertainty situations and can better focus on their work.
- However, unfortunately all employees working in private sector do not have access to employer sponsored disability insurance coverage.
- This employer sponsored long term disability insurance does not cover 100% of your lost income but it replaces major portion of your income say around 60-70 %.
- Elimination period have also now been reduced to few days to approximately a month. This elimination period is the time when you must wait from a disability to when you can begin collecting benefits.
- Benefits received from the insurance are non taxable.
- Although the structure of enrollment in long term disability insurance from employer can be same but it differs from employee to employee on certain factors such as: – occupation- riskier the job would be more will be the premium received. Age: – if you are young in age in the time of your policy enrollment money spent on your behalf for getting an insurance will be less and premium would be on little higher side.
- Long term disability insurance policy as provided by the employer is also customizable but with few prior terms and conditions involved.
- From a business owner’s perspective, deciding whether or not to offer this coverage takes thoughtful review of the costs and the ways disability insurance might help attract and retain talented workers.
- The facility to provide long term disability insurance to employees is present almost across the length and breadth of all states.
- Workers or employees who have access to disability insurance can continue saving for their retirement and know what their income is partially covered in the event if something happens to them that prevent them from working.
- While long term disability insurance is a long term valuable benefit to provide for employees but it can be costly for small business owners but on contrary to that the enthusiasm and confidence that is built in employees after providing benefits like long term disability insurance is something incomparable.
Disability insurance is one way to ensure that workers can access replacement wages if they become sick or injured and cannot work. Long term disability insurance is one of the best schemes that an employee can get from the employer.
Andrew Parker