Financial Peace of Mind for Employees

The importance of short-term and long-term disability coverage

Financial, physical and mental wellness all work together to support a healthy, balanced life. When employees feel confident about their finances, it can boost their mental and physical health, leading to greater focus, productivity, and engagement at work. Supporting financial wellness is a powerful way to enhance overall well-being and workplace success.

The importance of disability protection

Disabilities can happen to anyone, and the financial impact can be significant. Almost one in four of today’s 20 year olds can expect to be out of work for at least a year because of a disabling condition before they reach the normal retirement age.¹

Most of us know someone who has recovered from a short-term disability such as pregnancy and childbirth recovery, injuries and short-term rehabilitation after medical procedures. Disabilities preventing an employee’s ability to work for longer periods of time may include heart disease, mental health conditions or cancer.

Disability insurance is a crucial aspect of financial well-being as it safeguards earning potential, the foundation of financial stability. 

Disability insurance plays a vital role in a comprehensive financial strategy.

Financial obligations such as mortgage payments, utilities and daily living expenses can rapidly become burdensome without a reliable income. When finances become burdensome, both physical and mental health may decline as well.

Disability benefits support all aspects of wellness

Disability insurance plays a key role in supporting both the health and financial well-being of an employee by providing income protection and reducing stress during periods of illness or injury. Here's how:

1. Financial security during time off

If an employee is unable to work due to a medical condition — whether physical or mental — disability insurance replaces a portion of their lost income. This allows them to:

• Continue paying for essential needs (e.g. housing, childcare, food, utilities).
• Avoid dipping into savings or retirement funds.
• Stay current on bills and debts, preventing long-term financial consequences.

2. Promotes health and recovery

Knowing that income is protected allows employees to:

• Focus on recovery instead of rushing back to work out of financial pressure.
• Access necessary medical care without worrying about losing income.
• Reduce stress and anxiety, which can worsen physical or mental conditions.

3. Encourages a health-conscious work culture

For employers, offering disability insurance:

• Demonstrates a commitment to employee well-being.
• Reduce absenteeism and turnover.
• Enhances morale and loyalty, as employees feel supported.

Short-term vs. long-term disability: understanding the difference

Short-term disability (STD):

• Provides income replacement for a temporary period (typically three to six months).
• Covers employees who are unable to work due to injury, illness, mental health issues or pregnancy recovery.  
• Benefits usually begin after a short waiting period (e.g., seven days).
• Employees receive a weekly benefit determined by their earnings. 

Long-term disability (LTD):

• Provides income replacement for extended periods (typically beyond six months, lasting years or even until retirement, depending on the plan).
• Covers serious medical conditions or injuries that prevent employees from working for an extended time, such as cancer, heart attack or stroke, or mental health issues.
• Benefits often begin after the exhaustion of short-term disability benefits or an elimination period (e.g., 90 days).

Disability coverage through Advance Insurance Company of Kansas 

Advance Insurance Company of Kansas (AICK), a subsidiary of Blue Cross and Blue Shield of Kansas, offers tailored short-term and long-term disability solutions designed specifically for businesses of any size. AICK plans provide financial security to your workforce while ensuring your business remains resilient when unexpected challenges arise.

Contact your Blue Cross and Blue Shield of Kansas representative if you have any questions about your current policy or to get started with a disability plan.