Things to Consider Before Selecting a Temporary Disability Plan for Your Company

Employees are the backbone of a company. It is them, especially those who hold key positions that determine the fate of the company. This becomes evident when they are absent from work due to an accident, illness, or other disability as it is during this time that a company realizes the importance of an employee’s work. This is the reason why employers have temporary disability benefits in place so that they can help their employees in times of medical need to soften the financial blow on them.

But it is not an easy job for employers to select a short term disability plan for their employees. They need to think about the financial impact, coverage provided by a plan, duration of the coverage, and other factors. Below are some essential factors that an employer needs to consider before opting for a temporary disability insurance plan.

Who Contributes To the Benefits?
You as an employer need to consider who will be paying for the coverage. Often big companies solely take care of the entire premium costs. But those which are of smaller size put a part of the coverage responsibility on the employees with the help of payroll deductions. Smaller companies have to do this as they do not have a big budget.

Although it is mandated in certain states such as New Jersey for employers to have disability insurance in place, employers do have the freedom to write their temporary disability insurance plan either through the state or a private company. One of the top benefits of disability insurance taken through a private insurance agency is that you can save as much as 15 to 20 percent on your premiums.

When the Benefits Start Kicking In
You as a business owner can determine when the coverage comes into effect and this can have a bearing on the costs of premiums. Premiums could be on the higher side if the coverage starts on the first full day of injury or sickness and the first day of employee absence as the period of coverage is longer. This is the reason why most temporary disability benefits commence from the 8th or 10th day of an employee’s absence.

How Long the Benefits Last
Another factor that requires your attention when it comes to short term disability plan is the duration of coverage as it too impacts the cost of premiums. Although employers can extend the coverage duration to 180 days, the typical duration of short term disability coverage is of about 12 weeks. However, companies mostly choose to keep the coverage duration within 180 days because if they go beyond it, the cost of coverage also increases.

How Much To Cover
As it can be quite a lot for an insurance company to cover, most business owners choose not to cover the full amount of the employee’s pay. Providing coverage for the full amount of the employee’s pay reflects in the insurance premiums as well as they too get costly for you. That is why it is up to you as an employer how much coverage you want to provide to your employers.

EZTDB can help you come up with the best temporary disability insurance plan as we have partnered with some of the best private insurance agencies in the New Jersey state. With a private short term disability plan, you can avail of a host of customization benefits that will prove advantageous both for you and your employees.