Disability Insurance Reduces Workers' Comp Claims, Studies Show

Disability insurance can reduce costs for employers.

No matter how diligent an employer is about workplace safety, accidents happen. Workplace accidents—and employees who lose time due to workers’ compensation claims—can damage company morale and cost employers additional time and money. HR Executive Thinks About Disability Insurance Benefits

However, a recent report shows that 47 percent of large companies who offer disability insurance (DI) show a decrease in workers’ comp claims. In addition, 43 percent of small businesses and 33 percent of mid-sized companies reported a drop in claims. The reduction in claims was substantial for all companies: 15 percent of all employers reported declines of 50 percent or more, and 15 percent reported declines of 25 to 49 percent.

Disability insurance, including mandatory or enhanced DBL coverage in New York, TDB in New Jersey and TDI in Hawaii, as well as private Short Term Disability and Long-Term Disability, typically pays faster than workers’ comp cases, and it’s easier for employees to file a claim. It’s no wonder employees would rather be paid through insurance coverage, especially when the broker can walk them through the claims process and provide white-glove service every step of the way!

In addition, employees could wait months for a workers’ compensation claim to begin paying. Most people cannot live without a paycheck—especially as medical bills begin to add up. After a one-week waiting period in New York, employees can begin collecting DBL benefits for up to 26 consecutive weeks.

Disability Coverage: A Smart Financial Choice for Employers

It’s faster and easier for employees to file disability insurance claims than workers’ compensation claims. And it’s also faster and easier for employers, with less paperwork to fill out. Additionally, many workers’ compensation cases end up in court to prove the extent of the injuries. Disability insurance claims do not require the business to retain legal counsel to defend itself in a workers’ comp case, saving employers both time and money.

While it should be obvious that workers’ comp only applies to on-the-job injuries, the reduction in claims when other options, such as state-mandated disability coverage, short-term disability, or long-term disability insurance—is offered might make HR directors and other business leaders wonder about the incidence of workers’ compensation fraud. Fraudulent claims hurt everyone, costing employers in real dollars, wasted time, and damaged employee morale.

Disability Insurance Protects Employees from Any Illness or Injury

It’s important to reiterate that workers’ comp should only cover on-the-job accidents or injuries. But off-the-job injuries are far more likely to occur, with 729 people injured every 10 minutes, according to the National Safety Council. Businesses collectively lose more than $15 million from these injuries.

While a good disability benefits package won’t eliminate these costs, it can improve employee retention following an accident, and alleviate some of the financial burden on an injured or ill employee—perhaps resulting in a faster recovery and return to work.

Explore Your Disability Options with The DBL Center

If you own a business in the state of New York, New Jersey or Hawaii, you already provide your employees with mandatory disability coverage (DBL, TDB, and TDI, respectively.) An enhanced benefits package may help reduce workers’ comp claims further by enabling better claim service and greater benefits. Businesses in other states should also consider offering STD or LTD coverage to their employees to reduce workers’ comp claims and save money.

The DBL Center Ltd. can help.


Selling TDB Insurance in New Jersey? Tips to Earn More Commission

Insurance brokers earn more with privatized TDB insurance in New Jersey.

New Jersey has some of the best mandatory temporary disability benefits (TDB) in the country for its employees, offering two-thirds of the employee’s weekly wages up to $615 per week for a maximum of 26 weeks. If you’re a New York Tri-state area insurance broker, you may wonder why you’d bother selling privatized TDB insurance to businesses in New Jersey.

Our servicing General Agency works in conjunction with preferred private insurance carriers we represent to find you better rates than the NJ Department of Labor, which fluctuates on an annual basis. But almost more important than the savings, by privatizing your TDB insurance offerings for certain customers and bundling it with other ancillary group benefits, you can lower your customers’ insurance premiums on all their benefits while increasing your commissions.

Sounds compelling, right? The DBL Center gives insurance brokers the tools to earn more commission selling privatized TDB in New Jersey.

At the same time, you’ll enjoy a higher quality of service through The DBL Center and our highly experienced back office staff who is here to serve yours and your clients’ needs. We’ll answer questions about claims, and always ensure you’re getting the best value in your insurance coverage for your clients.

Let’s explore some of the ways you can earn more commission with ancillary group benefits and privatized TDB coverage in NJ.

Increase Your Earnings with Group Benefits

It’s no secret that many employees (and employers, for that matter) are upset by the affect the Affordable Care Act had on their healthcare coverage. Increased premiums, higher deductibles, and fewer choices in carriers may cause talented, in-demand employees in competitive fields to hunt for jobs with better benefits.

The only up-side is that ancillary benefits are now an easier sell. Employees might be paying more for healthcare coverage, but they can get a better value on vision or dental coverage – which may have, previously, been part of their healthcare plan.

Insurance brokers can save the day for business owners, CEOs, HR directors, and employees, with benefits that employees want at premium rates they can afford. At the same time, you’ll earn more commission because you’re selling larger benefits packages, without adding new customers. You’ll save time and increase your earnings all in one step, with The DBL Center beside you for support every stepof the way.

Offer Privatized TDB Insurance for More Flexibility and Better Service

When you write NJ TDB policies with a private carrier through InsuranceWholesaler.net, you’ll enjoy the white label, white glove service The DBL Center is famous for. We become your full-service, back-office support staff, while your customers associate the stellar service with you and your firm. Your customers will get more flexibility in how and when benefits are paid, and you can even increase the amount of coverage with just a small increase in premium rates.

Provide It All at Substantial Savings

When you write your TDB insurance policies, plus ancillary benefits such as Group Life / AD&D, long-term disability, short-term disability, Dental and Vision through The DBL Center, you’ll earn additional discounts for your customers, with no extra work by you, the broker. Just like bundling your home phone, cable and internet under the same provider offers you discounts, or writing your home and auto insurance under one policy gives you lower rates, bundling employee benefits nets big discounts, happier customers – and overall higher commissions because you’re expanding your book of business with very little extra work.

If you’d like more information on how privatized TDB insurance in New Jersey can benefit you and your customers, contact The DBL Center.


“Meternity” Book Spotlights Shortcomings in Employee Benefits

Today’s HR directors can provide equitable employee benefits to all.

If you or your spouse has read or seen the new novel “Meternity,” you might find the premise unrealistic – if not completely ridiculous. The book’s author, Meghann Foye believes women who choose not to have children should still receive paid time off during their child-bearing years. She wrote a novel exploring what might happen if a 30-something worker faked a pregnancy to claim her “meternity” leave. “[A]s I watched my friends take their real maternity leaves, I saw that spending three months detached from their desks made them much more sure of themselves,” Foye writes in the NY Post.

But rather than revealing how unfair maternity leave is to childless workers, the book, in fact, succeeds to showcase the shortcomings in minimum employee benefits across the board. And the insurance industry is in a good space to help HR directors and CEO solve these problems.

Current Disability Benefits Law in NY

In New York, employees currently file for maternity leave under disability benefits law, which entitles new mothers to receive up to $170 per week for 26 weeks, maximum. Depending on their salary, this amount may be much lower, as DBL is calculated as 50 percent of the claimant’s average weekly pay. Many parents can’t afford this level of pay cut, so choose to stay home only 12 weeks; most day care facilities accept children as young as three months, but not younger than that.

With the introduction of federal mandatory Paid Family Leave benefits next year, maternity packages will be more enticing. But for now, creating fair maternity leave policies – as well as equitable benefits packages for the rest of their employees – is in the hands of business owners.

Enriched DBL Gives Mothers and Babies the Time They Deserve Until Paid Family Leave Goes Into Effect

Do working moms really get better employee benefits?
Employers have the choice to offer more than the minimum DBL coverage. An enriched DBL package in New York can bring the percentage of benefits closer to the employee’s salary. Enriched DBL could mean new parents — today, two years before PFL goes into effect — may not have to cut corners as much at a time when their living expenses increased because they had to add the cost of diapers, baby products, and additional medical coverage and care to the family budget.

Enriched DBL also makes it possible for new mothers to take their full 26 weeks, going back to work when the baby is six months old instead of just three. Of course, it’s not like babies are self-sufficient at this age, but they are more interactive and many are sleeping through the night – which makes getting up in the morning to go to work that much easier from a physical perspective.

Enhancing Your Other Employee Benefit Packages

But let’s get back to that book that casts a resentful eye on working mothers everywhere. Certainly, some employees do feel resentment toward working parents, but anyone who has friends who are working moms – or who has ever had a conversation with a mom about work/life balance – knows it’s not all it’s cracked up to be.

Parents don’t look forward to missing days of work due to children’s illnesses or leaving early for school meetings. In fact, they begin to fear their job security and it can make it harder for them to get ahead in a competitive workplace.

However, as we all know in the business world, appearance and perception matters. If your other employees harbor resentment toward members of your workforce, it’s time to make a change.

Short of providing a paid sabbatical to childless workers, ask them what kind of benefits they’d prefer. Maybe it’s a better retirement plan. Or group life insurance coverage for themselves and a spouse. Maybe your employees are unhappy with their health care coverage and would like ancillary benefits like dental and vision.

Bundled with enriched DBL coverage in New York, these benefits become very affordable. Talk to your insurance broker or contact The DBL Center, today, and we will connect you with a trusted partner who can help.


Paid Family Leave Joins DBL as Mandatory Benefit in New York State

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Effective January 1, 2018, New York joins the progressive states of California, New Jersey and Rhode Island to require mandatory Paid Family Leave for all qualifying employees. This affects all business owners in New York State, not just those with 50+ employees.
If you’re an insurance broker already providing Disability Benefits Law (DBL) coverage or enhanced DBL, your clients may have questions about this new benefit. First, it’s important to understand that PFL is not the same as the federal Family and Medical Leave Act (FMLA). FMLA only secures an employee’s job and does not provide additional funds should an employee have to take a leave of absence due to childbirth, caring for a disabled child or caring for an older family member. A federal program, FMLA only applies to employers with 50+ employees.

Who Qualifies for PFL?

Unlike FMLA, PFL mandates up to 12 weeks of job-protected, paid leave for all New York employees, regardless of the size of the company, for any of the following reasons:

-bonding with and caring for a newborn, adopted, or foster care child during the first 12 months
– caring for a seriously ill family member
– addressing important needs related to a family member’s military service.

The Specifics of PFL

To qualify for PFL benefits, a full-time employee must have worked 26 or more consecutive weeks. Part-time employees must have worked 175 days. PFL benefits will be phased in over time to reach the maximum paid leave, never exceeding a percentage of the state’s average weekly wage (AWW), beginning January 1, 2018. Benefit amounts are as follows:

Beginning January 2018: 50 percent of the employee’s AWW for 8 weeks
Beginning January 2019: 55 percent of the employee’s AWW for 10 weeks
Beginning January 2020: 60 percent of the employee’s AWW for up to 10 weeks
Beginning January 2021 and on: 67 percent of the employee’s AWW up to 12 weeks

What Else Your Customers Need to Know About PFL

Employees are permitted – but not required – to use their accrued vacation time or PTO in addition to PFL benefits, but cannot claim DBL and PFL at the same time. PFL benefits begin on the first full day the employee requires paid family leave. When possible, the employee should give 30 days’ notice, but if this isn’t possible, such as in the event of a family emergency, or a premature birth, they should let the employer know as soon as possible. In either case, benefits can start on the first day off. The PFL benefit is funded by a nominal employee contribution; employers are not required to fund any portion of the PFL benefit. However, employers must invest in a policy that covers both DBL and PFL benefits under the same policy, but, as of right now, New York State Disability Benefits Law will not change under this new legislation. This could be the first step in legislation that would increase the statutory benefit in phases. That’s why it’s a great opportunity to evaluate your customers’ DBL coverage now to prepare for what may come.

Why It Matters to Insurance Brokers

As you re-write your customers’ DBL policies to cover PFL in preparation for January 2018 and beyond, this represents an opportunity to employ consultative selling techniques to increase your customers’ DBL policies with Enhanced DBL coverage.

Keep in mind: Employers are not required to fund PFL coverage, so no money comes out of their pockets as their employees’ benefit coverage improves. This is a great time to re-evaluate your customers’ DBL coverage. Are they doing enough for their loyal employees? What if you could increase the employees’ nominal contributions just a bit more, beyond PFL coverage, and provide an enhanced DBL policy that offers expanded benefits and more flexibility in how employees collect those benefits? Employers might even be willing to match employee contributions for a more robust enhanced DBL policy.

These are pre-tax benefits, and with the 2016 presidential election coming up, the future remains uncertain. Will taxes go up for the working middle class to fund programs the new president may support? Employees and employers alike will be looking for additional ways to reduce their tax liability.  Increasing insurance coverage for events that are likely to occur (and may even be planned), such as the birth of a child, a spouse’s military service, or the illness of an aging parent, provides a peace-of-mind that is hard for middle class, working Americans to find in today’s economic climate.

Why This Is Important for America

The new PFL requirements fill an important space today. These benefits affect every generation of worker, as “sandwich generation” or Generation X, and Baby Boomer employees face hardships caring for aging loved ones, and younger GenX and Millennial workers may plan to start families through childbirth or adoption.

Today’s insurance brokers are in a unique position to support a program that supports American families, while increasing their own commissions through consultative selling of PFL and enhanced DBL benefits in New York.


What Can Employees Do When Temporary Disability Runs Out?

Business owners in New York, New Jersey, and Hawaii must provide temporary disability payments for up to 26 weeks to employees who are ill, injured, or had a baby. But 26 weeks is not a long time for a person with a significant injury or a life-changing illness. Where can employees turn when temporary disability (DBL coverage in New York, TDB in New Jersey, and TDI in Hawaii) runs out?

Social Security Disability Insurance (SSDI)

Some people with an illness or injury may try to apply for Social Security benefits. However, to qualify for Social Security / Disability benefits, you must be unable to work for at least one year, or have an illness that will lead to death. The time between 26 weeks and a year is a long span to live without any income if you are unable to work. That’s where income replacement insurance – purchased privately or through the employer – comes in.

One of The DBL Center’s insurance broker partners in your area can assist with these types of coverage.

Why Healthy Individuals Need Disability Coverage

The Social Security Administration estimates that a 20-year-old employee faces a three in ten chance of becoming disabled before age 65. Other reports say one in four workers becomes disabled during their working life. These odds increase for heavy smokers, people who are overweight, or those who have a chronic condition such as heart disease,diabetes, or high blood pressure.

Yet, only 45 percent of millennial workers have long-term disability insuranceApril-Post-1-TD-Runs-Out, according to The Hartford Financial Service Group. More than 20 percent of millennials said they would need help from family or friends or move back in with their parents if they were unable to work due to illness or injury, while another 20 percent would have to rely on credit cards or borrowing against their 401K retirement account.

While employees don’t want to consider being one of the 25 to 30 percent of people who become disabled, it’s a reality. And most disabilities are caused by illness, not injury. Knowing they are protected, whether through private income replacement insurance or employer-funded temporary disability benefits offers peace-of-mind and greater financial security.

Extended Disability Coverage through the Employer

As the person in charge of the purse strings, you may wonder why you’d want to invest in additional insurance coverage that will pay out to your employees but not offer your company any real benefit?

The cost to the company is actually very small, especially if you purchase coverage as part of extended disability benefits. Extended disability coverage not only increases the length of time employees may be covered, but can provide more than the state maximum in benefits. Employers may collect up to 75 percent of their salary – enough to live on, in most cases –through enhanced disability benefits.

This benefits package may entice help entice star talent, but, more importantly, it can help you retain high-quality employees after they bounce back from an illness or injury. If your company took care of them in their time of need, they will return to work with a degree of loyalty. In fact, due to the strain financial difficulties place on person’s health, having disability coverage to provide for themselves and their family could, in fact, help make a return to work after injury or illness possible.

Private Long-Term Disability (LTD) Insurance

For self-employed contractors or individuals whose companies don’t provide extended disability coverage, insurance brokers offer long-term disability or income replacement insurance. Since the premiums on this insurance are paid out-of-pocket, the disability income is not taxable, so claimants receive their full benefits when they need the money most.

The Choice Is Yours

As the business owner or person in charge of HR decisions for the company, the decision to provide extended or enhanced disability coverage lies in your hands. Weigh cost factors with the intangible benefits of employee recruiting and retention.

Keep in mind that disability coverage doesn’t have to be “all-or-nothing.” You can give your employees the option to buy into a policy with lower premiums than they would get if they purchased individual disabilityon their own. Or you can split the cost with them. Since this is a pre-tax benefit, some employees may enjoy the tax benefits, too, although it means they will have to pay taxes on their disability income if they ever make a claim.

However you choose to structure the offerings, consider making extended disability coverage part of your employee benefits package. Contact your insurance broker to help you explore your options.