Disability insurance can be a safety net for employees in California. When employees have non-work-related accidents that prevent them from working or earning a living, their earned income is protected. Disability insurance benefits include paid sick leave, short-term disability benefits, and long-term disability benefits.

Given the high number of Americans living with disabilities, getting disability insurance is a smart move for people who support themselves and their families through their jobs. Long-term disability (LTD) insurance in particular is extremely beneficial for employees who might experience a serious illness or injury. While California does have a short-term disability program that pays up to 55% of your wages for up to a year, California does not have a long-term disability program. Social Security disability and SSI disability, which are notoriously hard to qualify for, are the only other options for long-term disability benefits in California.

Long-term disabilities can continue anywhere from five years to the remainder of an individual’s life. However, only 30% of American workers in private industry currently have access to employer-sponsored long-term disability insurance coverage through their employers.

Typical group long-term disability (LTD) benefits start when sick leave and short-term disability benefits are exhausted, and it replaces about 60% of one's pay. In contrast, Social Security disability benefits are based on lifetime earnings, and the average monthly payment in 2018 is $1,200 per month (up to a maximum of $2,788 per month). SSI pays even less; the federal monthly payment for 2018 is $750 per month if you have no other income, plus California pays a small state supplementary payment to most SSI recipients.

Here are some important facts to understand if you are looking to insure and protect yourself against disability.

• How to get LTD. Long-term disability insurance can be obtained either by a group or individually. Group coverage can be offered through an employer, professional group, or association.
• Eligibility. For employees whose companies offer long-term disability coverage, the individual must work for a specified period of time known as a service wait. For professional or association-affiliated LTD coverage, the individual must be a member of the group for a set period of time.
• Price of LTD. For individual LTD coverage, you will be responsible for the entire cost of insurance. In group LTD coverage, your employer may pay the full cost but you may have to pay percentage of the cost or a set premium.
• Coverage. Long-term disability coverage can last from one year to the age of retirement – usually 65. However, some plans differ; consult the summary plan description to verify the number of years covered by the insurance policy.
• Medical costs. The LTD policy covers only wage replacement, not health coverage.
• Pre-existing conditions. A pre-existing condition is any medical condition for which medical care was received three to six months prior to the coverage effective date. LTD plans may have a pre-existing conditions exclusionary period. During this period of time, an individual's prior medical condition(s) will not be covered by the policy.
• Partial benefits. Employees whose hours are reduced because of a disability may be eligible to receive partial benefits.
• Other benefits. Getting LTD benefits does not preclude an employee from applying for other benefits program such as California's State Disability Insurance (SDI) or Social Security Disability Insurance (SSDI). However, your LTD benefits are usually reduced by the monthly amount you receive in SDI or SSDI. Workers' comp benefits are also "offset."

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