Understanding the Basics of Long Term Disability Insurance – What you Should Know

Disability is a serious threat in today's world.  With recent figures estimating that one out of four of today's twenty year olds will become disabled by the time they reach retirement age and around twelve percent of the population already classified as disabled, it's really more common than you might suspect.  These facts highlight the importance of offering long term disability insurance to your employees.  Of the various types of insurance you can offer your employees, many experts agree that long term disability is one of the most important.  Long term disability offers a way for your employees to protect themselves and their families, and is more valuable than many other benefits you might offer.  Here are some of the basics of long term disability insurance.

When understanding long term disability, it's a good idea to start with the basics of disability insurance as a whole.  While workers comp will often pay a good deal of any medical costs and even some lost wages due to a disability for a period of time, it only really applies to injuries that occur on the job and will pay out far less than long term disability can.  Other disability policies, long term disability included, will normally function by replacing a portion of the income that an employee loses if they become injured and unable to work.  As its name suggests, long term disability offers more coverage for a longer period of time.

Most policies that don't qualify as long term disability insurance will pay out various amounts of money for set periods of time.  In the beginning, you'll likely receive nearly one hundred percent of your pay.  As time goes by the payments could lower to sixty percent or less before being exhausted completely.  Long term disability insurance, however, will pay a set percentage out for a longer amount of time.  In most cases you can purchase long term disability insurance that will pay up to sixty percent of lost income and can find coverage that will pay out until the age of sixty five.

In many instances additional long term disability insurance coverage might be an option.  The employee can contribute more money to the long term disability insurance policy and boost their possible payments to as much as eighty percent.  The exact specifics of any long term disability insurance plan will vary but in most cases coverage will include any kind of injury or illness that prevents an employee from working and payouts from the long term disability insurance policy begin once that all paid sick days have been exhausted.

Two additional factors to look for in long term disability insurance include the terms non-cancelable and guaranteed renewable.  Adding non-cancelable protection to your long term disability insurance will ensure that your long term disability insurance provider can't raise your premiums for any reason.  Guaranteed renewable means that your long term disability insurance plan can't be dropped unless you skip out on premium payments.  Unicorn HRO offers creative and flexible insurance solutions and can help you manage your long term disability insurance needs.


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