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What is Disability Insurance?

What would you do if suddenly you were unable to work due to an accident or illness? How would you be able to survive financially during your recovery? Do you know what type of disability insurance coverage you have…if any? These are important questions you need to have answered in order to protect yourself and your family financially in case of a disability.

In general terms, disability insurance is a plan that provides compensation protection in the event you are unable to work and/or earn an income. There are two types of disability insurance, private insurance, and Social Security disability insurance.

Private disability insurance is an insurance policy that can be provided by your employer, or you can purchase as an individual. Usually, it comes in the form of short-term disability or long-term disability. Short-term disability usually covers you for the first six months of your disability. If your disability continues past six months then the long-term disability insurance would kick in. In both cases, you will need to apply to your insurance company for coverage. To receive the benefits of this insurance coverage you will need to prove your medical disability prevents you from performing your past work. The benefit of this program, as compared to the Social Security disability insurance program, is that the waiting period for approval is significantly shorter. The approval for the disability coverage usually takes a significantly shorter amount of time.  Also, you only need to prove you are disabled from performing your past work.

Social Security Disability insurance is a federal program that you pay via Social Security taxes. Unlike private disability insurance, the Social Security disability insurance program is not optional. As long as you work and file taxes on your earnings, you will be paying into the Social Security disability insurance program. To obtain these federal benefits you must be out of work for 12 months or expected to be out of work for 12 months due to your disabling condition. Social Security does not provide for short-term disability. If you are out of work for only a few months your options are either your private insurance program (hopefully you signed up for one), or seeking help from your state. You also need to prove that you are unable to do both your past work and any other type of work in the national economy.

Just as a recap, Social Security Disability insurance is not optional, it does not provide for short-term disability benefits, and it requires you to show that you not only are unable to do your past work but also any other type of work in the national economy. Private disability insurance programs are fully optional, they provide more flexibility in terms of coverage for how long you will be out of work, and allow you to qualify as long as you are unable to perform the work you have done in the past.

Knowing what disability insurance you have and planning accordingly can save you and your family a lot of headaches in the future. Because of the strict regulations on obtaining Social Security disability, it is a good idea to protect yourself with a private disability program as well. Private disability programs can be tailored to meet your needs, whereas Social Security disability cannot. If you are unable to work and don’t know what to do you should call an experienced disability attorney. At the LaBovick Law Group, we make sure to provide more than just legal assistance for our clients. Call us today for your free consultation.

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