In a world where health plans and PTO dominate the employee benefits conversation, life and disability insurance often remain in the background, mentioned during open enrollment, rarely revisited, and often misunderstood.
Yet these benefits are among the most critical protections a person can have. They serve as a financial lifeline during the worst moments of life: serious illness, accidents, chronic health issues, or even death.
And for employers, they represent more than just another line item; they’re a powerful tool for attracting talent, demonstrating empathy, protecting productivity, and reducing long-term costs. So why aren’t more organizations treating them like a priority?
Let’s walk through the educational case for why offering, funding, and most importantly, educating your workforce about life and disability benefits is not just a best practice, it’s a necessity.
Why It’s Important to Offer Life & Disability Insurance Benefits
Every employer offers health insurance. Fewer provide income protection.
But here’s the reality: health insurance pays the doctor. Disability insurance pays the rent. When someone can’t work due to a serious illness or injury, their ability to earn a paycheck disappears, but their financial obligations don’t.
And the risk is more common than many assume:
- More than 1 in 4 workers will experience a disabling event before retirement age.
- The average long-term disability claim lasts 34.6 months, nearly three years without a paycheck.
- 51 million working Americans lack adequate disability coverage.
For families living paycheck to paycheck, or even those with some savings, a loss of income can lead to long-term financial instability, debt, or loss of housing. The same applies to life insurance. Without it, a sudden death can leave dependents without the means to cover funeral costs, mortgage payments, or childcare. By offering these benefits, employers provide something truly foundational: peace of mind.
Why It’s Important to Fund These Benefits (Not Just Offer Them)
While some organizations make life and disability coverage available as voluntary or employee-paid options, the uptake is significantly higher when employers contribute to the cost, even modestly.
Here’s why funding matters:
- Lower financial barriers = higher participation. Employees are more likely to enroll when the company shares the cost or provides a base level of coverage.
- Shows commitment. Funding these benefits signals that the employer truly values financial protection and well-being, not just compliance.
- Improves plan performance. Larger pools create better pricing and a more stable claims experience over time, which benefits both the employer and employees.
- Boosts equity. Lower-income employees may not be able to afford optional coverage even if it’s available. Employer contributions help close this gap.
Why Education Is the Missing Link (and the Most Powerful One)
One of the biggest challenges around life and disability benefits isn’t availability, it’s awareness. Many employees:
- Don’t understand what the benefits actually cover
- Don’t realize how vulnerable they are without coverage
- Assume they’re protected through other means (e.g., workers’ comp or Social Security)
- Can’t imagine becoming disabled and underestimate the risk
This knowledge gap can lead to under-enrollment, misinformed choices, and ultimately financial hardship in moments when protection is needed most.
Why Consultants Matter, and the ROI of Getting It Right
A skilled benefits consultant can be the difference between a check-the-box life and disability plan and one that truly protects your people. They help employers design plans tailored to workforce demographics, model costs to balance value and budget, and negotiate with carriers for better coverage and pricing. Just as important, consultants ensure compliance with laws like FMLA and ADA, and develop communication strategies that help employees understand, value, and actually use their benefits. They also bring ongoing oversight, monitoring claims trends, and employee feedback to continuously optimize the program.
When life and disability benefits are thoughtfully offered, funded, and communicated, the payoff is clear: improved retention, reduced absenteeism, greater financial well-being, and a stronger, more resilient workplace culture. In a landscape full of trendy perks, income protection remains one of the most powerful and underutilized tools in a total rewards strategy, and one that pays off when it matters most.