That's an interesting concept and I see your reasoning for doing 95% rather than 100%. However, I almost always do 100%. When you go to voluntary the rates go up and benefits usually go down. The net cost is about the same as 100%. Since we are talking about low dollar amounts as compared to health insurance, I tell the employer that Disability Insurance is one of the best priced benefits they could ever buy. It keeps employees from coming to the employer for an advance when they are out for several days, it helps make a clear sick pay policy, it covers normal pregnancy leave for 6 weeks, it is good PR when employees talk around the water cooler about how their coworker still has income even though disabled, and it gives the employer the funds from the disabled person's normal salary to use on a replacement or alternative during the disability. So, I suggest that the Employer sign up everyone and pay 100%.
And, even on my voluntary DI plans, I NEVER run it through Section 125 premium-only. The tax deduction is minimal, and the impact at claims time is huge.
And, even on my voluntary DI plans, I NEVER run it through Section 125 premium-only. The tax deduction is minimal, and the impact at claims time is huge.
