Long-Term Disability Insurance Plans

Employees who get injured or fall ill might be unable to work for a long time. In worse cases, they might be unable to return to the job they had or earn as much as they did. As such, they are classified as disabled and can benefit from a disability insurance plan if they have one. 

There are two types of disability insurance policies: short-term and long-term disability insurance plans. This article focuses on long-term disability (LTD) policy, explaining what it is and its coverage. 

What Is Long-Term Disability Insurance? 

LTD insurance is a policy that protects employees from losing income when they cannot work because of an illness or accidental injury for an extended period. A person who willfully harms themselves cannot claim long-term disability insurance benefits when away from work. 

Also, LTD does not cover work-related injuries. If the illness developed or the injury happened because of unsafe conditions at work, you cannot get long-term disability benefits. Instead, your employer’s workers’ comp insurance will handle income payments. 

What Does Long-Term Disability Insurance Cover?

Long-term disability insurance covers illnesses and injuries that arise after a person buys a policy. If you have a pre-existing medical condition, you cannot claim LTD benefits. Some common conditions listed in LTD policies are cancer, pregnancy, and musculoskeletal diseases. 

Mental health illnesses are not always covered by long-term disability insurance. Some insurers include it in their plans, while others exempt it. Also, an LTD policy pays more than Social Security Disability Insurance (SSDI), and you can buy a critical illness insurance policy to supplement the LTD plan. 

How Much Does Long-Term Disability Insurance Pay?

LTD insurance covers up to 50% to 70% of an employee’s salary before the illness or injury. Therefore, you or your employer will likely pay between 1% and 3% of your salary as a premium. However, insurance companies have different policies, so the percentage may differ slightly.

Most long-term disability insurance policies have a waiting period, and you can get short-term disability insurance benefits within that time if you have a plan. Also, once you start receiving LTD payments, you must constantly update your insurer on your medical condition. Failure to do so will cause the insurer to terminate your benefit. 

At Goldstein Healthcare, our team will provide detailed information on different long-term disability insurance plans and help you make an informed choice. Contact us today for more details.