Dealing with an injury can be stressful and frustrating. When recovering from your injury means you cannot work, you may start to wonder how you can make ends meet while also paying for your care.
Depending on your situation, you may have short-term or long-term disability benefits through your employer. These benefits can support you through your recovery.
These are the primary differences between employer-provided short and long-term disability benefits.
Many workplaces offer short and long-term disability insurance at no or little cost to employees. Short and long-term disability insurance gives you financial protection if you cannot work or your ability to work becomes limited.
Keep in mind, while some coverage is better than nothing, disability insurance often does not replace 100 percent of your lost income. In most cases, coverage is between 40-70 percent.
How are the benefits different?
In addition to short and long-term disability benefits covering different durations often, long-term disability will often provide a smaller compensation percentage. Since long-term disability coverage could continue until you reach retirement age or longer, it typically covers up to 70 percent of your salary (rather than up to 80 percent typically covered by short-term disability.
There are also different waiting periods for short and long-term viability. Short-term disability is both for shorter disabilities and covering the gap until long-term disability benefits start. Short-term benefits can start from zero to 14 weeks, while long-term disability usually takes three to six months for benefits to start.
Which one do I need and when?
Short and long-term disability insurance policies typically work together. The first one or two months that you are unable to work would fall under short-term disability. If you still cannot work at the end of the short-term disability term, you would move to long-term disability.
Depending on your disability, long-term disability can last provide support for years. It could last until you are eligible to claim Social Security benefits.
It is critical to note that these policies work together. There is typically a period of 60 to 90 days before you can receive long-term disability benefits. Short-term disability coverage is there to support you during the gap between the time you are disabled and when long-term disability begins.
When you have questions about short or long-term disability benefits, it is important to talk to an experienced professional.