Disability and Your Finances for ON Semiconductor Employees

Healthcare Provider Update: Healthcare Provider for ON Semiconductor ON Semiconductor partners with various health insurance providers to administer employee healthcare benefits. While the specific provider may vary based on location and employee needs, large national insurers such as UnitedHealthcare and Anthem BlueCross BlueShield are often utilized by companies of ON Semiconductor's size. This partnership emphasizes ON Semiconductor's commitment to providing comprehensive healthcare benefits to its workforce. Potential Healthcare Cost Increases in 2026 As we look ahead to 2026, ON Semiconductor, along with other companies, may face substantial increases in healthcare costs due to anticipated record hikes in premiums for Affordable Care Act (ACA) marketplace plans. Reports indicate that some states could experience premium increases over 60%, driven by factors such as rising medical costs and the potential expiration of enhanced federal premium subsidies. This perfect storm of challenges is expected to push out-of-pocket premiums up by 75% or more for a significant number of enrollees, thereby amplifying the financial burden on employers and employees alike. Companies like ON Semiconductor will need to prepare for these increased costs in their healthcare budgets, particularly as the healthcare landscape continues to evolve dramatically. Click here to learn more

'For ON Semiconductor employees, personal disability insurance is a vital financial protection that provides a stable source of income to replace lost earnings due to a disabling injury or illness, unless government programs are unavailable.'

'Given the recent changes in the government disability benefits, it is important for ON Semiconductor employees to purchase personal disability insurance to cover their needs in case of disability due to health problems.'

In this article we will discuss:

1. The need for personal disability insurance as an alternative to government benefits.

2. Workers' compensation and personal disability insurance: What are the differences?

3. The benefits of individualizing disability insurance coverage for the needs of each person.

As a ON Semiconductor employee, you should be aware that the Social Security Disability Insurance program paid out $143.7 billion in benefits in 2018. However, the number of applicants every year means that the fund is expected to be exhausted by 2034 unless the government acts. Instead of turning to the government's program to help them meet their financial needs during a disability, many people protect themselves with personal disability insurance.

Disability insurance helps by paying between 50% and 70% of your salary if you become disabled due to an injury or illness. Because disability can result in two forms of financial burden, this type of coverage may be very useful. Disabled people are usually unable to work and face other costs related to their condition.

What About Workers' Comp? Most people think that workers' compensation is a kind of disability insurance. However, workers' compensation is only available to workers who are disabled in the course of their employment. If your disability was caused by a car accident or other non-work related incident, you may not be eligible for workers' compensation. We would like to remind our ON Semiconductor clients that every state regulates its own workers' compensation laws and payments, which means that the availability of the coverage can be very different. Especially if you have a hazardous job, you may want to find out what your state offers and then make up for the shortage. Similarly, if any of our ON Semiconductor clients have an active pastime that may lead to disability, it may be wise to seek additional protection.

Private disability insurance can be purchased to pay weekly or monthly amounts during a period of disability. Provided you have paid up your premiums, the benefits are not taxable income. When buying a policy you may be able to adjust coverage to suit your needs. For example, you might be able to change the benefits or the elimination period. You may decide on general protection or decide to define coverage more specifically. Some policies also provide partial disability benefits, cost of living adjustments, residual benefits, death benefits, and pension benefits.

Because the purpose of insurance is to replace income, almost everyone decides to buy coverage only during their working years. Despite reforms being made to the federal disability programs, they usually provide only a small amount of money, and one must qualify for it. For the ON Semiconductor employees who do not want to depend on the government for funds in the case of an accident or illness, disability insurance can be a good way to secure their income and assets.

Out of Commission:

The unemployment rate of working-age disabled Americans is 19.6%. Chart Source: ACLI Life Insurers Fact Book 2018 Administration of Social Security, 2019 Policy coverage is written by participating insurance companies. Not all states offer all policy categories and product features. Any obligations are dependent on the insuring insurance company's ability to pay claims. This information is not intended to serve as tax or legal advice. It is prohibited from use to evade federal tax penalties. After-tax investment returns could be influenced by changes in federal and state laws and regulations. Contact a tax professional or an attorney for information that is applicable to your situation.

Added Fact:

According to the Harvard Business Review, the average length of a long term disability claim is 34.6 months. This means that if a ON Semiconductor employee was to get a disabling injury or illness, they could be out of work for over two and a half years without income. This is the reason why it is crucial to consider the need for personal disability insurance for ON Semiconductor employees to ensure that they are financially secure in the event of a disability. This way, they can have peace of mind knowing that they have a safety net to turn to in the event of a disability.

(Reference: Harvard Business Review, 'The Disability Disconnect: The Workers' Compensation System Fails to Protect All Workers,' March-April 2019)

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There is no protection for disability risks if one has no financial preparation. It is, therefore, not recommended to walk the tightrope without a safety net. As ON Semiconductor employees, you have strived to achieve financial freedom but a disability can undo all your efforts. As a tightrope walker, the safety net gives him confidence and security, personal disability insurance gives financial security. It guarantees that if you are unable to work due to a disability, you will not be left financially vulnerable. Disability insurance provides support, which means that it helps you by paying you a certain amount of money to help you sustain your financial status. It is therefore important to take disability insurance to ensure that in case you are unable to work due to an injury or illness, your financial future is secure.

Sources: 

1. Social Security Administration.  Annual Statistical Report on the Social Security Disability Insurance Program, 2018 . Social Security Administration, 2019,  www.ssa.gov/policy/docs/statcomps/di_asr/2018/di_asr18.pdf .

2. Fort Pitt Capital Group. 'Should You Carry Disability Insurance Beyond Age 65?'  Fort Pitt Capital Group , 24 Sept. 2020,  www.fortpittcapital.com/blog/disability-insurance-in-retirement .

3. Special Needs Alliance. 'An Introduction to Private Disability Insurance.'  Special Needs Alliance , 2021,  www.specialneedsalliance.org/the-voice/private-disability-insurance-2 .

4. Guardian Life. 'Long Term Disability Insurance vs. Social Security.'  Guardian Life , 2021,  www.guardianlife.com/disability-insurance/long-term/vs-social-security .

5. MassMutual. 'Disability Income Insurance Policies for Individuals.'  MassMutual , 2021,  www.massmutual.com/insurance/disability-income-insurance .