Short Term vs Long Term Disability Insurance

Disabilities are health conditions that prevent people from working, like serious injuries or chronic medical conditions.

Disability insurance is either “short-term”, covering periods from a few months to a few years, or “long-term”, providing multi-year or lifetime coverage. You can choose coverage length that best fits your needs, and some people buy both short-term and long-term disability coverage

Where do I buy disability insurance?

Long-term Disability insurance can be acquired through your employer or directly through a number of insurance carriers. If you can’t get long term insurance through your employer, national insurance carriers will typically provide you with an individual policy.

Short-term Disability Insurance, on the other hand, is only available from your employer. Your employer’s human resource department can notify you whether or not short-term disability policies are provided by your company.

What exactly is short-term disability insurance?

Short Term Disability Insurance is intended to provide income replacement when injuries (a bad back, for instance) or medical treatment (surgery, for example) keep you from working for a period of one to six months. Since the amount of income replaced and the definition of “disability” differs from plan to plan, premiums for Short Term Disability Insurance vary substantially.

How is it different from long-term disability insurance?

Both short-term disability insurance and long-term disability insurance provide money for people who are unable to work..

Short terms disability insurance begins after the established “elimination period” (how long you have to be unable to work before claiming disabled benefits) and only covers the first initial weeks or months of disability. It’s intended to help you get by when you can’t work due to an injury or medical problem that keeps you out for a few months.

Long term disability insurance begins three to six months after you file for disability and can last years. It’s intended to be a long term replacement for lost wages. The money can pay for monthly living expenses such as food, clothing, and house payments.

If you have both a short-term policy and a long-term policy you can only receive benefits from one policy at a time.

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