How disability insurance can offer much-needed support to caregivers
Here are three considerations for employers looking to communicate with their employees about the benefits of disability insurance.
While the pressures of the pandemic have certainly tested all employees’ financial well-being, those who take on the added responsibility of caring for a child or adult at home have been hit particularly hard. Indeed, according to MetLife’s new Employee Benefit Trends Study, 54%of employees who are caregivers are living paycheck to paycheck.
Caregiver well-being is no small issue in today’s workplace. Just consider a recent AARP study estimates that 53 million American adults are currently caregivers for either an adult or child with special needs. These millions of employees must not only cope with the personal well-being struggles brought on by COVID-19 – from job insecurity to stock market volatility, pay cuts and more – but also the challenges of ensuring that they are able to provide for their dependents during this difficult time.
Related: The value of integrating disability and health plans
Thankfully, there are employer-offered benefits, like disability insurance, that can help provide employees who are also caregivers, with the income protection they need should they be unexpectedly unable to work due to a qualifying physical or mental health condition. Here are three considerations for employers looking to communicate with their employees about the benefits of disability insurance:
1. Cushion for unexpected costs
From basic needs like food and hygiene products to medical care, the ongoing essential expenses associated with caregiving can certainly pile up for employees. This may be why many caregivers say they struggle to pay their bills every month, and many are struggling to save. According to MetLife’s study, 41% of caregivers don’t have a savings cushion of at least 3 months, and 29% lack an emergency fund.
As a result, many caregivers may be unprepared to cover unexpected costs in the event that they are unexpectedly unable to work. With this in mind, employers can and should communicate to their employees about the benefits of disability insurance, which can help cover essential living expenses, including unexpected costs associated with caring for their loved ones.
2. Safety net for the future
Against the backdrop of these financial pressures, many caregivers have been left feeling uncertain about their long-term financial goals. In fact, 47% of caregivers say they often delay paying down debt, and more than half expect to postpone their retirement due to their financial situation.
Disability insurance, however, can help employees maintain a secure financial future by helping to cover essential living expenses like their mortgage, car payments, and utilities without dipping into their savings or retirement funds. This helps employees not only care for their loved ones, but also stay on track to meet important financial milestones until they can return to work.
3. Boost in employee performance
Disability insurance goes beyond supporting employees’ financial well-being; it can improve their performance at work, too. That’s because MetLife’s data shows a direct correlation between financial health and employee productivity.
Just consider that caregivers who feel in control of their finances are 43% more likely to say they feel productive, and those who have a savings cushion of at least 3 months are 33% more likely to say the same. When employees aren’t burdened with financial anxieties, it can be a win-win for both employees and employers.
As we transition to a post-pandemic world, it’s important to remember that employees’ caregiving responsibilities and the associated costs will continue, no matter where or how they work. As such, employers can and should encourage these employees to use benefits like disability insurance for additional income protection in the event that they are unable to work during this challenging time. The financial benefits of disability insurance could give employees comfort in knowing they will be able to support not only themselves, but also and their loved ones now and into the future.
Phil Bruen is senior vice president of group benefits at MetLife.
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