Short Term Disability

If you were to become disabled tomorrow and couldn’t work for two to three months, would you have enough savings to cover your living expenses during that time? If not, you may want to consider short term disability.

Short term disability insurance pays a percentage of your salary if you become temporarily disabled, meaning that you are not able to work for a short period of time due to sickness or injury(excluding on the job injuries, which are covered by workers compensation insurance).

Most short term disability insurance policies have a “cap”, meaning you receive a maximum benefit amount per month. Short term disability insurance policies also have a limit on the amount of time you receive benefits.

Long Term Disability

You may not realize the potential danger of becoming disabled. The U.S. Census Bureau estimates that you have a one in five change of becoming disabled. Also, the average long term disability absence lasts 2.5 years, according to the Council for Disability Awareness. That is a long time to survive without a steady income.

Becoming disabled can have devastating financial implications by stripping you of your ability to make a living. While some people can get by without working for a few months by tapping into their savings, few people can afford to stop working altogether for an extended period of time.

Long Term Disability picks up where short term disability leaves off. Once your Short term disability benefit expires, the long term disability policy pays you a percentage of your salary, usually 50 to 60 percent5, depending on your policy. You Will then receive benefits for 2 to 5 years or until you turn 65.