Disability insurance: before and after

There are lots of ways that an employer can boost production and motivate their employees. But think about this: how would productivity be affected if employees stopped receiving a paycheck? I'd venture to guess that the results would be somewhere in between "not good" and "disastrous." Above anything else, an employees' paycheck is the primary motivator for their work, which is why it's so important for employers to allow them the opportunity to insure their paycheck with disability insurance.



Now, in the event that an employee can't work, it's not expected that the employer pay them for work they're not doing; that's what disability insurance is for and why it's such an important benefit for employers to offer. But, while the paycheck is the primary motivational tool in an employer's toolbox, there are plenty of other reasons for employers to encourage their employees to purchase disability insurance, and to purchase as much of it as possible. A lot of these aren't just about the disability, they're about what comes before and after:

• Keeping employees focused - Forty-six percent of workers spend three hours or more during the work week thinking about or dealing with financial issues.¹ Before a disability even happens, worrying about the loss of a paycheck would certainly weigh on an employee's mind. Voluntary benefits and, particularly, disability insurance can help ease some of that anxiety about finances to create more engaged, effective employees. And, the more they purchase, the more confident they will be that their income is protected. To add to this, some policies include benefits for policyholders that don't have claims, ensuring that no matter what happens, they will get money out of the policy. Employees compare this feature to many auto-insurance policies, incenting them to purchase and keep their policies. In turn, this contributes to them being worry-free and focused at work.
• Returning ready financially - Let's say that something unfortunate happens and an employee does have to take time off of work to recover. If, as we pointed out above, many employees are distracted by financial issues at work, imagine how distracted they would be if they just had to take a leave for a month or two without any pay. Even if they do have disability insurance, if they haven't purchased enough, they can wind up being just as preoccupied with their financial situation when returning to work. Disability insurance can help eliminate financial distractions and keep workers focused before they miss any work and also helps make sure they return to work without added financial distractions.
• Returning ready physically - Disability insurance is generally thought of as protection for an employee's paycheck, but it plays a role in protecting their health as well. For one, it allows them to focus on their recovery while they're out of work rather than worry about their finances. On top of that, it helps to make sure they don't return to work prematurely. If an employee doesn't have disability insurance, or doesn't have enough, the financial pressure to get back to work may drive them to return before they're ready. This creates a bad situation for everyone involved; the employee is risking their health and the employer is getting an employee who may not be fully ready to work. Worst of all for everyone involved is that returning to work too soon runs the risk of their condition recurring or worsening.

Disability insurance tends to focus on what happens when an employee is disabled; and rightly so. But what's just important to keep in mind for employers is what happens before and after that disability. It's not just about protecting an employee's paycheck, offering disability is an employer's insurance that their employees can stay focused and healthy at work because their financial health is secured.

¹ What employees' financial unwellness is costing their companies. Forbes. September, 2017.

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