Disability Insurance

Three out of every ten workers between the ages of 25 and 65 will have an injury that will leave them unable to work for three months or more. With this statistic, long term disability insurance is an important thing for a company to provide to its workers. Many employers do not offer this to their employees, preferring instead to offer short term disability insurance or none at all. However, disability insurance is considered to be one the most important benefits to receive at a job, especially long term disability insurance.

• Roughly 60% of individuals injuries happen when they are not working. Worker’s compensation will not help them since they were not injured as a result of their job. A long term disability plan can help the injured employee receive a portion of their salary while they are unable to earn a living. Usually, a long term disability policy will start up after the employees short term disability insurance has expired.

• Years ago, many employers chose to spring for the full price of long term disability insurance. Now, long term disability insurance is usually paid for in different ways. A disability insurer may help to fund the long term disability insurance. The other options are having the long term disability funded by the employer, the employee or a shared costs among both the employer and the employee. Employers are allowed to choose how much coverage that they will provide for their employees in term of salary percentages. The length of time of the plan benefits can be extended for a period of time. Some long term disability plans pay five to ten years worth of the disability benefits while will pay until the individual is 65-years-old, depending on which comes first. The average amount of the salary that one receives under the long term disability insurance is 50% to 70% of their current salary.

• For an employee to be eligible to receive long term disability they must meet the requirements of a working for a certain length of time with their employer as well as a former full-time work schedule with the company. Full time is considered 30 hours per week or more. Individuals receiving long term disability insurance should expect to receive a percentage of their salary paid monthly. They should also expect these long term disability payments to begin anywhere from 90 to 180 days after the occurrence.

Since long term disability insurance usually is a follow-up of short term disability insurance, an individual may want to get started on applying for a long term disability plan while they are still under short term coverage, if they know that they are going to be needing it. Short term disability insurance cannot be extended, it can only be turned into long term disability insurance.

Short Term Disability

Short term disability insurance is a type of insurance that pays a certain amount of an employee’s salary for a specific time period. This short term disability can help those who are sick or injured. Due to the short term disability they have, they are temporarily unable to perform their specified job duties. Short term disability insurance is different from regular Social Security disability income.

• The individual usually begins receiving the short term disability money about one to 14 days after they are rendered temporarily disabled and can no longer perform their job duties. Employees are often required to use their available sick days before the short term disability kicks in. It is because of the differences among individuals receiving short term disability insurance due to a serious injury and those receiving short term disability insurance due to an illness that sick days will often be used first.

• A short term disability is often paid for by the employer of the company that the individual is taking a short term disability break from. However, companies do have the option to have employees pay for their own short term disability insurance coverage, with certain tax consequences for the employer. Employers have the right to order that sick days be used by employees first before the employee’s short term disability begins. Employers can also demand a doctor’s note from the employee proving the need for the short term disability.

• There are different qualifications that must be met before an employee can be deemed eligible for short term disability insurance. The first one is that the employee must have worked for the employer full-time before the injury or sickness. This is considered 30 or more hours a week. Employees also have to have been working with the employer for a substantial period of time to qualify for short term disability.

• There are things that an individual should expect when receiving their short term disability plan packages. The percentage of the employees previous weekly salary must be between 50% and 70% of their weekly salary. Unlike regular disability, the time limit that an individual can remain on short term disability insurance, usually between ten and 26 weeks. This time period cannot be extended. If one needs more time, then they must apply for long term disability, which has a more lenient set of regulations about the temporarily disabled person.

Knowing the rules of the state that an individual wants to receive short term disability insurance in is important to find out what they qualify for. The laws about short term disability insurance can vary from state to state.