Choosing the Right Long Term Disability Insurance Policy – A Brief Guide
With today's young workers facing an estimated one in four chance of becoming disabled by the time that they retire, long term disability insurance is one of the most important investments that an employer can make for protecting their employees and one of the best that employees can choose to utilize. Since medical problems contributed to sixty two percent of bankruptcies filed in 2007, and recent studies suggest the number has climbed since then, it' more important than ever to protect yourself with long term disability insurance. A lot of variables are present in long term disability policies, and understanding the main factors to look at when choosing long term disability coverage can help you find the best policy to offer your employees.
The first thing to understand is why long term disability insurance is a better choice than short term. Just as its name suggests, it lasts longer. Short term policies may lapse within a year or two, but with a bit of searching you can find long term disability insurance policies that last for a decade, two, or even until the injured party is sixty five years old. And most long term disability insurance will pay at least sixty percent of salary earned, which means that even though not all of the income is being recouped, at least most of it is. Many long term disability insurance policies will allow the employee to add money to the premiums and boost up payouts to as much as eighty percent of total salary.
When you begin to really review long term disability insurance policies, look at just what the term disabled is defined as. A broken back for a carpenter is just as disabling as severe carpal tunnel syndrome for a computer programmer, employment-wise. Some long term disability insurance policies include mental and physical disabilities while others only focus on physical. Whatever your business deals with, be sure that health problems that affect your employees' ability to work are covered under the long term disability insurance plans you're going to buy. And find out when claims start under the long term disability insurance policy, since most begin after a set period of weeks.
Long term disability insurance is best when you add a non-cancelable clause to them. This ensures that the long term disability insurance provider can't raise your premiums for any reason. Guaranteed renewal is another feature to look for in long term insurance, and as long as you don't miss payments you won't have to worry about losing your coverage. Also be sure to look into COLA adjustments, which adjust your long term disability insurance payments annually based on cost of living increases.
These are the main features to look at when deciding which long term disability insurance plan is the best one for your employees. Adding various options such as the ability to put their own income towards the long term disability insurance policy for added coverage is great, and keeping a few things in mind can help ensure total coverage for as long as possible. Unicorn HRO can help you with all of your long term disability insurance management needs, from setting up a great long term disability insurance plan to managing it for years to come.