We appear to be in the midst of a labor shortage. Employers are going to have to do more to retain top talent, and executive disability insurance benefits can help.
Businesses are reopening post-pandemic, but they’re having a hard time finding workers. According to KTLA, the worker shortage may last for years because the working age population is shrinking as Baby Boomers retire.
Meanwhile, workers know they’re in demand, and many are planning to switch jobs. According to Forbes, a Prudential study found that one in four American workers plans to look for new opportunities after the pandemic, while a Microsoft study found that 40% of workers are thinking about leaving their employer this year.
Why Workers Quit
Workers quit for many reasons. However, it’s often because they want better compensation. Increasing salary is one way to appease workers, but employers should also consider the allure of a fantastic benefits package.
Unfortunately, many employer-sponsored long-term disability insurance policies fail to protect top earners effectively.
Any coverage is better than no coverage. Group long-term disability products often cover about 60% of the regular income, with monthly benefit caps of $5,000. For many workers, this may be adequate – but not for executives. The monthly benefit cap means that workers earning more than $100,000 per year will receive less than 60% compensation. The higher their income, the smaller the percentage becomes. For an executive earning $250,000 a year, the monthly maximum of $5,000 is only about 24% of the previous income. This sort of pay cut can require a massive lifestyle adjustment.
How to Retain Top Executives
Offering group long-term disability coverage to all workers is a great start. However, to make sure top earners have adequate protection, employers should consider offering additional coverage.
A Guaranteed Standard Issue disability insurance policy is a great way to do this.
A Multi-Life Guaranteed Standard Issue policy can protect all of the executives at a company without the need for medical exams. Rates are discounted when three or more workers are covered.
By offering this coverage to executives earning at least six figures, employers can provide the extra paycheck protection they need – and give them one more reason to stay with the company.
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