Mike, the owner of a small outdoor adventure company, had a serious fall while rock climbing and was unable to work for almost a year. With no money coming in and extra money going out for rehabilitation, Mike could have been in trouble. But when he started his company, Mike enrolled in a disability plan that would replace most of his income if he couldn’t work. Mike was able to focus on his recovery instead of his finances, until he returned to work.
What does disability insurance typically cover?
Short-term disability benefits replace a percentage of your employee’s income for a period of weeks or months if they are unable to work due to an injury or illness unrelated to work.
If they are unable to return to work when short-term disability coverage ends, long-term benefits come into effect for a set number of years, or until the employee reaches retirement age. Long-term disability supplements disability benefits available from government programs.
Optional short and long-term disability plans offer coverage for the spouses of employees, so that their entire family is looked after. Employees pay for this type of plan through monthly premiums that are deducted from their paycheques.
How can disability insurance benefit your company?
When you calculate the odds of an accident, serious illness, or mental health issue happening to you or one of your employees, disability insurance makes sense.
A provincial healthcare plan can help pay the medical bills, but to replace lost income, you need disability insurance. It provides financial stability so that your employee can get immediate help, and then focus on their recovery. It means that they may be able to return to work sooner and in better condition.
Disability insurance also allows your team to support their co-worker emotionally, without worrying about how they are surviving financially. When employees feel that they and their co-workers are looked after, it inspires loyalty and a positive morale, which can show in tangible ways such as reduced turnover and absenteeism.