It can turn out quite expensive to insure your business. But if there was such an insurance product that would both provide your employees with the necessary coverage in specific situation and have a good cost in general? Fortunately for most business owners, there's such a type of insurance - gap or disability insurance. Having a disability insurance policy is a very good way top secure your workers in extreme situations caused by their work, and save you some money with its tax deduction ability.

Gap or disability policies are aimed at providing additional coverage outside typical health insurance plans for workers. Most disability policies usually provide the following coverage that common health insurance plans do not provide to businesses:

• Income replacement - During the disability period the worker is reimbursed with lost income under the disability plan.

• Out-of-Pocket expenses - Typical out-of-pocket expenses such as deductibles and co-pays can get in the way when the person is seriously ill or disabled for a period of time. Disability plans do not have such annoying features.

• Short and long-term coverage - The person gets covered for the entire period of disability whether it's a short or long-term coverage.

Usually, this type of business insurance is offered to employees by a set of options they can choose from in order to meet their exact needs with regards to their age, health condition, marital status, income level and others. It's the worker who chooses the exact coverage amount to meet his or her personal needs. Small business insurance plans can also include disability insurance because it all depends on the exact activity of a company and not its size. It doesn't matter if there are 5 or 500 workers employed at your business, because for as long as there's a risk for the employee to become disabled due to operational activities, there will be a need in disability insurance. Moreover, having such coverage will lower the risk of legal actions from the worker's part, who may become dissatisfied by his or her condition if not covered properly.

The tax-saving feature of disability plans is achieved through the ability of the business owner to pay premiums prior to taxation. And that's a huge advantage, especially for small enterprises that keep their costs and taxes on thorough control. Moreover, this allows the business owner to get a smaller taxable payroll for FICA and FUTA. This effectively cuts FICA and FUTA taxes paid by the enterprise, with an average $76.50 saved on these taxes for every $1,000 paid for premiums prior to taxation. Consult with your tax specialist in order to calculate the saving possibilities for your enterprise specifically.

Employees benefit from the tax saving feature as well. Because the premiums are paid before taxation, their general tax liability is lower than usually. Not to mention how good it is for the worker to know that he or she will be covered in any situations that can take place during their working hours. And that could be a really good encouragement for work productivity and loyalty to the employer.

So, as you see disability plans offer substantial benefits that can make your business even better both for you and your employees.