Group Disability for Employees

Business & Benefits

Group Disability for Employees

There are two categories of disability insurance:

  • Short-term disability insurance offers benefits typically lasting up to 16 weeks, but it can extend up to two years.
  • Long-term disability insurance provides benefits for an extended period, following the cessation of short-term disability benefits. While a standard disability policy offers benefits until an employee turns 65, certain policies are designed to provide benefits for two or five years.

It’s important to note that disability insurance payments are not indefinite. The benefits end either when the maximum benefit period is reached or when the employee returns to work.

Furthermore, it is crucial to differentiate between group disability insurance and other types of group coverage, such as group critical illness insurance, which grants a lump sum payment if an employee survives a life-threatening illness, and group life insurance, which pays their loved ones a lump sum payment to alleviate financial burdens in times of loss.

Group Disability for Employees

Disability insurance serves to alleviate the financial strain on employees who experience temporary or permanent inability to work due to injury or illness. It provides a percentage of the employee's regular income for a specific duration, with a maximum dollar amount.

Who pays for group disability insurance?

Designing a group disability insurance plan for a business offers versatile options. For instance, the employer has the flexibility to either have the business cover the complete premium, or to allocate a portion or the entire cost to its employees.

How is group disability insurance priced?

The pricing for group disability insurance can differ based on a business’s plan configuration and the insurance carrier choosen. Several factors that can influence the premium rate include, but are not restricted to:

  • Benefit coverage level
  • Employee count and average age
  • Industry and occupational hazards
  • Plan customization options
  • Claim history and experience rating
  • Geographic location of the business
  • Duration and waiting periods for benefits
  • Additional riders or optional features

Please note that these are just a few examples, and there may be other factors that can impact the cost of group disability insurance.

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For 26 years Pinkney Financial Services has been a very important part of my financial future. I’m most grateful for everything they have done for me over these many years.
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Retired Edmonton Public Teacher

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