Today, offering disability benefits "has become part of a broader discussion," Welke said.

The history: U.S. insurers use investments in bonds and other fixed-income investments to provide some of the cash used to support long-term disability products.

From 2009 through 2022, the Federal Reserve Board tried to heal the economy from the wounds caused by the 2007-2009 financial crisis by keeping interest rates near zero.

That helped people who had borrowed money to buy stock and houses, but it hurt returns on the bonds supporting LTD insurance.

Group disability issuers worked to reduce their dependence on sales of interest-sensitive insurance products by developing absence management programs.

The issuers also tried to focus on sales of short-term disability insurance and the new PFML insurance products, which are less sensitive than LTD insurance to changes in interest rates.

Today: Now, interest rates are up. The big group disability insurers have strong absence management programs, thriving group disability insurance products and thriving paid family and medical leave insurance programs.

The percentage of U.S. civilian workers offering short-term disability benefits increased to 43% in 2024, from 40% in 2019, and the percentage of workers offered long-term disability increased to 38%, from 34%, according to the latest Bureau of Labor Statistics survey data available at press time.

Related: Employer-provided short-term, long-term disability benefits at record highs

Long-term disability insurance premium revenue rose to $6.9 billion in 2023, from $6.4 billion in 2022, and short-term disability insurance premium revenue rose to $14.3 billion, from $13.5 billion, according to a Milliman issuer survey.

Executives at big, publicly traded insurers are now celebrating their group disability results when they go over their companies' earnings, not rushing to talk about something else.

Steve Zabel, Unum's chief financial officer, recently said during a conference call with securities analysts that the company's U.S. group disability ratio, or percentage of premiums going to pay claims, fell to just 59% in the fourth quarter of 2024.

"We've been able to apply data to better understand outcomes and to implement accommodations," Zabel said. "People want to get back to work, we want them to get back to work, and we've been very successful with our people, with our technology, to be able to do that at a higher rate."

The group disability insurance market may seem a little quiet, but it's a healthy market, Welke said.

"We still have many large carriers in the marketplace," Welke said. "Employees continue to look for this type of coverage." We continue to see a need, and we continue to see growth."

But most large U.S. employers already offer disability benefits, and employers' urgent, new need is for help with understanding the new state leave laws, which differ from state to state, Welke said.

Milliman found that state leave rules are starting to have a noticeable effect on the group disability market: PFML insurance sales increased to $300 million in 2023, from $200 million the year before, and overall premium revenue increased to $2.4 billion, from $2.3 billion.