Survey Probes Employer And Planner Attitudes Toward Disability Insurance
What opinions, motivations and plans are driving the key players in disability insurance coverage decisions?
Recent surveys of employee benefit decision-makers and financial planners conducted by Health Insurance Association of America, Washington, D.C., and JHA Inc., Portland, Maine, explored that terrain. The findings cast light on how employers and planners value disability insurance.
First, the employee benefit decision-makers point of view. More than 400 employer respondents completed the survey representing close to a million employees.
Among other things, this survey found that employers are motivated to offer disability insurance protection in order to compete for the employees they need.
Almost half the employer respondents (46%) consider their benefits packages to be better than comparable employers, while almost 51% consider their packages “average.” Only 4% could bring themselves to say their benefits packages lagged behind.
Not surprisingly, employers named health/medical benefits as the most important to employees. But 86% also said they need to offer additional benefits in order to stay competitive. In fact, over 60% who offer short- or long-term disability coverages reported doing so to attract and retain employees.
A related finding: The employers indicated they are not motivated to offer disability insurance as a means of absence management and returning disabled employees to work.
Relatively few said they value disability coverage as a return-to-work or absence management tool. In fact, less than a third of those surveyed strongly agreed, or agreed, that “disability insurance is effective in speeding rehabilitation and return-to-work.” Just under 21% disagreed with this statement and 3.5% strongly disagreed.
In addition, few identified return-to-work as a top reason for offering disability insurance. Only 13.5% that offer STD coverage, for instance, reported doing so in order to help enhance productivity and control absenteeism. For employers offering LTD coverage, this figure was even smaller, only 8.9%.
However, in yet another finding, the employers indicated they clearly recognize the need for disability insurance and are well aware that workers compensation and Social Security Disability Insurance do not sufficiently cover the financial risk of disability.