Insurance Information Institute Answers the Question: “Will My Employer Provide Disability Coverage?”

Posted on Oct 27, 2009

If you are a new employee or an existing employee, you may have questions regarding disability coverage provided by your employer.  In a recent article, the Insurance Information Institute answered the question, "will my employer provide disability coverage?" 

According to the Insurance Information Institute, before you file a disability claim, you need to find out what your employer offers when it comes to this type of insurance.  The majority of employers permit short-term sick leave, which can range from a few days to six months. 

Contact your benefits department to find out if you are covered.  You also need to ask how long you have to wait to begin receiving payments and how long the benefits are expected to last. Some employers' disability plans will also take other disability programs into account when calculating your payments. 

Nearly half of mid-size and large companies offer long-term disability coverage, although they are not required to do so by law.  Generally, a group long-term disability policy will offer benefits that pay about 60 percent of the workers' average salary.  Long-term disability benefits usually kick in when short-term benefits have been exhausted.  Typically, group long-term disability insurance is paid in full by the employer and employees do not have to make contributions. 

The article by the Insurance Information Institute also mentioned that you are required to pay federal and state tax on the long-term disability benefits, unless your employer pays it for you.

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