September 18, 2013

    MassMutual Study Reveals that Companies are Satisfied with Group Long-Term Disability Plans But Gaps in Coverage May Leave Executives Underinsured

    MassMutual Study Reveals that Companies are Satisfied with Group Long-Term Disability Plans But Gaps in Coverage May Leave Executives Underinsured

    (Springfield, MA) – More than eight in ten employers offer group long-term disability insurance (Group LTD) to employees, and while 83 percent of those employers feel the amount of base coverage is adequate, gaps still exist in the coverage for executives. Despite this exposure, only 15 percent of companies plan to change their Group LTD programs in the future.

    These figures are among the findings of the 2013 Employer Perspectives on Disability Benefits study, released today by Massachusetts Mutual Life Insurance Company (MassMutual) in collaboration with the Society for Human Resource Management (SHRM).

    “Not only are many executives at risk, but so are their families,” said Melissa Millan, senior vice president, worksite insurance, MassMutual. “We commissioned this study to help employee benefits executives and benefits managers benchmark their disability insurance plans more effectively, and help lead organizations to fully informed recommendations and decisions.”

    Surveying over 4,000 SHRM members on their organization’s Group LTD plans, the study explored benefits trends in companies of all sizes across a wide range of industries and sectors. While Group LTD programs proved generally robust, the study uncovered shortfalls that may impact high-earning and executive employees:

    • Typically, base Group LTD plans (78 percent) do not cover variable compensation, such as bonuses and commissions, which is a compensation structure more commonly offered to high-ranking and C-suite executives; and only 21 percent of organizations indicated that they offer ‘buy-up’ coverage.

    • Almost one-third of companies (29 percent) expressed concern that high earners with income in excess of the plan limit are not adequately covered.

    • Only 19 percent of survey respondents indicated that they offer supplemental individual disability income insurance coverage.

    “This study provides valuable insights and perspectives that may have not been available to employee benefits executives and benefits managers before,” said Millan. “Clearly, considering and addressing the shortfalls is the place to start.”

    For an executive summary of the research results, visit For more information on disability income insurance, tools and resources, visit or view this brief 2-minute video.

    The research study is based on a survey conducted by SHRM and commissioned by MassMutual. Fielded between July 10, 2012 and August 3, 2012, the survey received 4,402 responses from SHRM members across a wide range of industries, and included small, mid-sized and large organizations. The response rate was approximately 10% and the margin of error is +/- 2%.

    About MassMutual
    Founded in 1851, MassMutual is a leading mutual life insurance company that is run for the benefit of its members and participating policyowners. The company has a long history of financial strength and strong performance, and although dividends are not guaranteed, MassMutual has paid dividends to eligible participating policyowners consistently since the 1860s. With whole life insurance as its foundation, MassMutual provides products to help meet the financial needs of clients, such as life insurance, disability income insurance, long term care insurance, retirement/401(k) plan services, and annuities. In addition, the company’s strong and growing network of financial professionals helps clients make good financial decisions for the long-term.

    MassMutual Financial Group is a marketing name for Massachusetts Mutual Life Insurance Company (MassMutual) and its affiliated companies and sales representatives. MassMutual is headquartered in Springfield, Massachusetts and its major affiliates include: Babson Capital Management LLC; Baring Asset Management Limited; Cornerstone Real Estate Advisers LLC; The First Mercantile Trust Company; MassMutual International LLC; MML Investors Services, LLC, Member FINRA and SIPC; OppenheimerFunds, Inc.; and The MassMutual Trust Company, FSB.