Group long-term disability insurance is a critically important part of any employee benefits package considering that disabilities occur more often than people realize, and can last for years, according to Barry Petruzzi, second vice president, group life and disability for Guardian Life insurance Co.of America. The Social Security Administration estimates 30 percent of those who enter today's work force will become disabled before they retire, while the National Safety Council notes that a disabling injury occurs every three seconds in public and every four seconds at home.
There is the potential for a long term disability to last until someone reaches retirement age, which can equate to years, or even decades, without a steady pay check. Employers and their employees need to be able to count on their insurance carrier being there if the worst should happen. So what should you look for in an insurance carrier?
Petruzzi believes that there are several key elements that determine an insurer's financial strength. The hallmarks of a strong LTD carrier include a strong capital position, financial stability, conservative investment philosophy, independent recognition, and outstanding customer service with excellent claims paying ability.
Strong Capital Position: In today's economic environment, companies need to be well capitalized to meet financial obligations like paying long term disability claims over an extended period of time.
Financial Stability: Look for a company that has a long track record of providing benefit solutions and claims paying ability.
Conservative investment philosophy: Many companies are distracted by the short-term demands of Wall Street, instead of the needs of their customers. Working with a company that is focused on its customers will ensure that long-term benefit needs are met.
Independent recognition: Work with a company that is recognized as steady and strong by the ratings agencies.
Outstanding Customer Service: When selecting a disability plan, clients want to know that their carrier will be able to meet long term commitments. They also want their carrier to pay claims quickly and accurately, especially in turbulent economic times.
By choosing a stable insurance carrier, employers are in effect insuring the lives of their employees and helping families when they can most use financial assistance, Petruzzi explains. But on a more basic level, they're fulfilling their fiduciary responsibility under the law to secure the best possible benefits for their employees and avoiding a crisis situation.
-- Benefits Selling staff