As a business owner, offering a comprehensive employee benefits package is a great way to attract high-quality employees and reward your staff for their service. Benefits packages typically include health, life, dental, and disability insurance, with a portion of coverage paid for by the employer. Disability insurance covers a portion of employee wages when they take time away from work due to medical issues.
There are two types of disability insurance available: short-term and long-term. Short-term disability insurance covers the first three to six months of work leave, depending on the plan. If an employee’s health condition keeps them out of work for longer than the time frame specified in their short-term disability plan, long-term coverage kicks in.
Many medical conditions can lead to a long-term work absence, including:
- Mental health disorders
- Chronic pain
- Heart disease
- Back injuries
- Autoimmune disorders
Depending on the insurance company you choose for your plan, certain conditions may not be eligible for coverage. Long-term disability insurance typically pays 50-70% of a full-time employee’s salary during their absence for covered illnesses and injuries. Insurance carriers pay out monthly benefits during the benefit period outlined in your plan, which can be anywhere from a few years to a few decades.