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Income Protection With Disability Insurance in Columbus, Ohio

Statistics show that one in eight individuals will become disabled for five years or more during their career. This risk of illness or injury increases dramatically with age. People 50 or older account for 59% of disability claims. This is why many employers incorporate group disability plans as part of their employee benefits package, as well as the reason so many employees look to their employers for this important coverage.

Our employee benefits team at Haughn & Associates (H&A) can provide employer-sponsored coverage, including both short-term and long-term disability insurance, that protects workers, provides benefits, and helps retain quality employees. Our benefit specialists have the ability to answer questions about the definition of disability in various policies and address other issues such as the cost of different plans.

Group Coverage: Short-Term Disability Insurance

Short-term disability insurance will pay benefits based on a specified percentage of the worker’s base income during a temporary disability. After a specified brief waiting time — officially called an elimination period — short-term disability coverage pays the worker benefits that continue anywhere from three months to a year.

A group short-term disability plan helps cover daily living expenses and provides resources for recovery and the return to work.  If an employee is only able to do part of his or her job or work part time, he or she can receive partial disability benefits. This eases the transition back to work and keeps the worker involved with the company.

There are also STD plans that provide some financial protection while an employee is out on maternity leave. Depending on the plan, the policy may provide 50-100% of an employee’s income for about six weeks after giving birth, eight weeks due to a C-section, and potentially longer if there are complications.

Group Coverage: Long-Term Disability Insurance

Long-term disability (LTD) insurance picks up where short-term coverage leaves off and replaces a portion of the income of the employee during an extended period resulting from a disabling illness or covered injury. The elimination period on this policy typically encompasses 90 days or more. After that, benefits are paid for a longer period — anywhere from two years to age 65 or for life — depending on the policy’s specifics. By providing a steady stream of income to an individual who is disabled and unable to work, long-term disability insurance helps employees meet day-to-day financial obligations rather than fall behind on bills or draw on savings to pay living expenses.

Overall, there are fewer restrictions on the underwriting of group disability policies than you find on individual disability policies. This is because the risk is borne by the group rather than by an individual. Another advantage of group disability insurance is that premiums are much lower than the premiums for individual disability insurance policies since it’s more cost-effective to underwrite insurance for a group than for individuals. However, an insurance carrier may deny claims for pre-existing conditions with both individual and group disability insurance.

How Pre-Disability Income Is Calculated for Group Disability Insurance

When you offer group disability insurance to your eligible employees, you may wonder how much disability insurance is needed for your team members. When an employee files a disability claim, the worker will receive benefits based on his or her pre-disability income.

It is important to note that this amount is the base wage paid and does include commissions on sales, overtime earned, employer payments to a retirement savings fund, or end-of-year or other types of bonuses. While some policies may specify the earnings used are an average of several years, others may use the amount earned on the last day of work before the claim.

Individual Disability Insurance Can Help Employees Cover Group Plan Benefit Gaps

Although they appreciate the group disability insurance benefits offered by their employer, some employees protect gaps in the group benefits of disability coverage with an individual policy available from Haughn & Associates. Individual long-term disability coverage can supplement any group disability benefit with an additional monthly benefit, as well as extend the benefit period, depending on the policy purchased. Employees with higher incomes may especially benefit if they become totally disabled.

Often group policies require employees to stay with the same company to remain eligible for the group disability insurance plan. If an employee decides to take a job with another employer, it usually is not possible to take along the group disability insurance to the new company. With an individual disability policy in place, however, the disability benefits usually go with the worker.

Our Commitment to You

At Haughn & Associates (H&A), our core values and principles of integrity, honesty, dependability, innovation, and collaboration shape who we are and guide us; they ultimately allow our team to provide our clients with high-quality insurance products and an unparalleled level of superior service. Each business, family, and individual is given the personalized attention needed to design the right fit of insurance and risk management protection for your insurance package.