Illuminate The Risk
By
A typical working-age American is significantly more likely to become disabled than was the case 10 years ago. Even so, many employees dont put a high value on their employer-provided disability benefit.
When asked, most employees underestimate their chances of becoming disabled during the course of their career. That may help explain why employees tend to place less value on disability benefits.
Perhaps even more disturbing is the fact that a substantial number of workers are not even aware they are covered under an employer-sponsored group plan. It is, in effect, an "invisible" benefit.
According to joint research on insurance ownership by LIMRA International, Windsor, Conn., and consumer research group Integras, only 17% of the working population report being covered by a group disability benefit. The research drew from a panel of 300,000 U.S. households.
In reality, says the U.S. Department of Labor, 37% of workers participate in a short-term disability (STD) plan and 28% are covered under a long-term disability (LTD) plan.
That leaves plenty of growth potential. But producers who want to increase their group disability business should recognize that success will require a high level of involvement in the employee communication and education process.
This is particularly true when the products involve voluntary or buy-up disability benefits, which offer their own unique communication and educational challenges. While these products offer employees convenience and flexibility, they are just as likely to result in confusion and misunderstanding.
Employees need to have a greater appreciation of the economic importance of disability insurance in order to value the benefit and consider buying in or buying up. When employees are involved in the selection process as early as possible, it is more likely they will understand the benefits intrinsic value. Producers can play a key role in directing this value-creation process.
Whether at the point of sale or at renewal, producers should actively participate in the employer-employee communication process. This will help ensure that the plan enrollment campaign is properly designed and is effective in helping workers with diverse needs understand the value of the disability plan. Clear information and presentations using simple language, bulleted lists and colorful slides are appealing and effective.
