Replacing Workman's Compensation With Disability Insurance

[djs]

Do health insurance plans not cover part of what you are describing?

In theory I think its great that Worker's Comp covers medical bills, rehab, and some income. In reality I have watched family go through Worker's Comp and the situation is much different. It would be more honest if they simply said, "Go home and stop breathing, you are hurting our bottom line."

Health insurance plans almost always have language to exclude injuries that workers comp SHOULD cover, regardless of whether there is workers comp or not.

My experience is for minor things, health plans don't really care, they will pay. Once the injury starts involving surgury, you better think twice. If it's chronic, they will also pass the buck to workers comp.

Don't get me wrong. Workers comp isn't as much for the injured party as it is for the employer.

Now, if you want to have a discussion about there being to many different coverages for various things that may happen, causing people to perhaps become insurance rich and cash poor, it would probably be a short conversation. We would all agree.

Why not have your health plan cover you 24 hours a day? It should. Maybe that is the reform we will get (yeah, don't hold your breath).

Dan

 

[JustinUpright]

Just checked with a business today and they don't have WC on themselves as owners but their major med has a on the job rider. So they are covered there now just need to get them on a DI plan.

 

[LGilmore]

Usually a business owner has the option to exclude themselves from WC plans. The group health insurance plans have terminology that will cover owners 24/7 for medical costs. Where DI would come in is the income replacement aspect of WC. But most DI would come with at least a 30 day wait and premiums for such a short elimination period would be pretty high so I don't know if it would be practical or "better" financially.

 

[The DI Doctor]

I agree with alot of what you are saying, Disability can be part of the overall solution, but should not be considered some kind of ultimate or all encompassing solution. That should be considered when speaking of many situations where disability insurance can come into play. Everything has its pros and cons.

I still don't see how a DI policy covers the same risk. Let's take a scenerio, one we hope doesn't happen...

A worker leans over a railing, falls, breaks his back. Permanently paralyzed.

What does DI cover? A portion of his income for the period of the insurance.

What does workers comp cover? The medical bills, the rehab bills, income, etc.

The DI policy will fall far short, at least the way I see it. Am I wrong?

Yes, minor stuff, no big deal, perhaps. Broken leg.... workers comp would have benefits, not out long enough for DI to kick in. Cut a finger off? Same thing, workers comp would have benefits, not out long enough for DI. Have a back injury, but not catastrophic, out 6 months? Okay, not much workers comp needed, DI might work.

Give me an example where a work injury has better benefits under DI than under workers comp.

I'm a believer in DI, I just feel this is bad positioning, leaving a huge exposure to the business owner.

Dan

 

[disability Insurance Reso]

I don't have too many clients that would give up 10% of their equity to save on worker's comp...

I agree, besides the owner had better make sure there was medical and hospitalization in place, in the event the worker got hurt on the job in lieu of what W/C would have paid and the income protection policies had a SHORT elimimation period which will possibly far ecceed the cost of W/C!