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Voluntary A&D insurance may reduce Workers' Compensation claims


 

Forty-two percent of all companies providing access to voluntary Accident and Disability insurance experienced declines in their Workers’ Compensation claims.(Photo/Shutterstock)
Forty-two percent of all companies providing access to voluntary Accident and Disability insurance experienced declines in their Workers’ Compensation claims.(Photo/Shutterstock)

It's no secret that companies and their risk managers all want to reduce Workers' Compensation claims. You would be hard-pressed to find a risk manager who didn't list that as among his or her goals. But that's easier said than done. 

However, recent research shows that offering voluntary Accident and Disability insurance helps alleviate Workers’ Compensation claims for businesses. This presents an opportunity for brokers to communicate the benefits of these voluntary policies to a client’s workforce and serve as a trusted advisor and educator. By having direct access to employees and educating them on these policies, brokers can ensure the right products are selected and, in turn, help clients alleviate risk through voluntary Accident and Disability insurance.

According to the Aflac Workers’ Compensation Report, conducted by Lieberman Research Worldwide, 42% of all companies providing access to voluntary Accident and Disability insurance experienced declines in their Workers’ Compensation claims.

Another study reinforces the role Accident insurance plays in risk management. Aflac’s “Impact of Voluntary Accident Insurance and Voluntary Disability Insurance on Workers’ Compensation Claims and Worker Absenteeism Study,” conducted by Research Now, reports that 40% of all companies providing access to voluntary Accident insurance experienced declines in their Workers’ Compensation claims. When responses were broken down by company size, the survey found that 50% of large companies, 38% of medium companies and 36% of small companies all benefitted.

Additionally, when employers were asked whether they currently make voluntary Accident and Disability insurance available to their workers, 36% say that they do not offer voluntary Accident and 27% report that they do not offer voluntary Disability policies. This means it’s prime time for brokers to stress the importance of offering this type of coverage, especially in light of the changing health care landscape.

Impact of off-the-job injuries on business

While not every business has to worry about an influx of Monday-morning Workers’ Compensation claims, this issue does raise concerns for off-the-job safety as well as safety at work. According to the National Safety Council, every 10 minutes, 729 people will suffer an injury severe enough to require a medical professional, which amounts to more than $15 million. That’s $90 million in just one hour. Today, more and more businesses believe safety outside of work promotes good management of health care costs, productivity and profits just as much as workplace safety.

More than 3 million nonfatal workplace injuries and illnesses were reported by private industry employers in 2013, yet only 7% of workers say it’s extremely likely that they or a family member will become disabled in the future. This further underscores the importance of educating employees and communicating to employers that offering accident and disability voluntary insurance policies is a key component of business success. Simply put, offering these policies is a way for companies to potentially save money without having to actually spend money.

It’s important to emphasize to clients that by making voluntary Accident or Disability insurance available to their workers, they could decrease the frequency and expense of Workers’ Compensation claims and absenteeism. By providing clients with a strategy to mitigate healthcare and Workers’ cCompensation costs, brokers have the power to demonstrate their value to clients as well as grow their business.

Added bonus: voluntary Accident or Disability insurance comes at no cost to a company’s bottom line!


 

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