Aflac survey finds nearly half of companies offering disability insurance see reduction in workers compensation claims.
Aflac has found that 42% of companies who offer voluntary accident and disability insurance saw declines in their workers compensation claims. This study is fascinating because it confirms something we see as attorneys. People will choose the path of least resistance when it comes to fighting disputed workers compensation claims.
Our experience is that employers prefer to file under a disability insurance policy because it costs less money. Some of our clients are even instructed to lie about how the injury occurred so that it will be not be excluded as an occupational injury.
The simple act of providing disability insurance does not reduce the number of workplace accidents. So what is the motivation for the study? We think it’s to sell more disability insurance policies. Here is what Aflac has to say in its press release:
“These findings confirm the correlation between accident and disability insurance and reduced workers’ compensation claims. Employers can now weigh the potential positive financial effects of offering accident and disability insurance against the costs of workers’ compensation claims,” said Tye Elliott, Aflac vice president of Core Broker Sales. “The results demonstrate that by making voluntary accident and disability insurance available to employees, companies can often decrease the frequency and expense of their workers’ compensation claims.”
Why is workers compensation better?
Disability insurance only covers a portion of wage loss for a limited period of time. It is generally purchased as part of a group policy with the employer. Some employees actually pay the entire premium out of their paychecks. Disability insurance typically does not cover work-related accidents or injuries.
Workers compensation is a category of insurance that almost every employer in MichiganÂ is required to purchase. It protects both employers and employees in the event of a workplace accident. Available benefits include lost wages, vocational rehabilitation, and lifetime medical treatment. These benefits are tax-free.
The big lie about who is paying
We have written about shifting workers compensation costs in the past. How limiting access to workers’ compensation moves the costs away from the responsible employer. In fact, an article published by Futurity in 2012 found “almost 80% of these costs are paid by employer-provided health insurance, Medicare, Medicaid, Social Security, and other disability funds, employees, and other payers.”
We think Aflac has been a great product for many of our clients. It has bridged the gap while their workers compensation cases are in litigation. However, workers compensation should not be abandoned and insurance company denials must be challenged. Shifting costs to taxpayers and other insurance companies ends up creating higher premiums for everyone.
Michigan Workers Comp Lawyers never charges a fee to evaluate a case. We have represented injured and disabled workers exclusively for more than 35 years. Call (855) 221-2667 for a free consultation. Â
Photo courtesy of Creative Commons, by 401(K) 2013.