5 BEST Short Term Disability Insurance Q&A
5 BEST Short Term Disability Insurance Q&A
What is Short Term Disability?
Many people don’t consider what will happen to them financially if they are hurt or become ill.
If the injury or illness is to a degree that they are unable to work for a temporary period of time, it is known as a short term disability.
In some cases, employers may offer their employees insurance to cover this temporary disability.
However, there are certain restrictions regarding what does and what does not classify as this type of disability.
These restrictions may vary depending on the state and the particular insurance plan, particularly when it comes to receiving funds from short term disability insurance.
Why you need Short Term Disability
Short term disability is a disability in which a person is unable to perform his work for a temporary period, which is usually 26 weeks or 6 months.
Under normal circumstances, when a person is unable to work, he is without a source of income.
Although there is not a steady income during this period, he is still obligated to continue making payments on his regular bills, such as his mortgage or rent.
In addition, he must also be able to buy food, medication and other expenses.
Short Term Disability through an Employer
Depending on the employer or the state, he may be eligible for a type of insurance that is called short term disability insurance.
This pays the employee a certain percentage of his income as long as he meets the requirements for eligibility.
An employee may receive short term disability insurance in one of several ways.
In some cases, employers provide the insurance, with or without employee contributions to the plan.
If an employer also provides paid sick leave to his employees, this insurance will typically not go into effect until shortly after that leave has been exhausted.
In other cases, temporary disability will not go into effect until the employee has been unable to work for a period of one to two weeks.
Employees may sign up for their own plan through a provider that is made available through their job. In some states, such as California, employers are required by law to provide their employees with disability insurance. The administration of these plans varies by state.
Short Term Disability Eligibility
In order to be eligible for short term disability, a person must meet certain requirements.
If the person is requesting short term disability because of an injury it must not be an injury that occurred as a result of his work.
In terms of illness, it must be a condition that qualifies under the terms of the specific plan.
The employee must be unable to perform his job during the time that he is ill or incapacitated and must generally have the recommendation of a physician.
Also when it comes to qualifying for short term disability, pregnancy and childbirth meet the necessary requirement.
This is often for a shorter period of time than the disability coverage for an illness or an injury.
Depending on the employer, a person may need to also meet certain employment standards before he can claim temporary disability. For example, an employee may need to be full time and have worked the job for a certain number of months prior to the incident.
Short Term Disability Coverage and Duration Period
Short-term disability coverage can last anywhere from 9 weeks to two years, depending on the policy. However, short-term disability payments usually won’t kick in until about a week or two after the employee is unable to work.
These payments are made weekly and again, depending on the policy, could pay out a flat rate of about 40-60 percent of the worker’s wages, or it could start out at 80 percent of the worker’s salary and taper off to 40-60 percent.
Once short-term disability runs out for an employee, it may be time to move them into a long-term disability plan if they still can’t come to work.
Why should I offer short or long-term disability?
Companies that offer disability insurance and even other group benefits have major advantage when they’re hiring and retaining talent. According to certain studies:
- 57% of job seekers consider employee benefits as a determining factor in whether they take a job or not.
- 84% of employees that are satisfied with their benefits are also more satisfied with their jobs and more loyal to the company.
- 80% of employees would actually prefer more benefits over a raise.
Employees are also likely to be less stressed, and thus, more productive if they know that they would be taken care of should something happen. You may even be eligible for a tax deduction for offering group benefits.
So, why wait to improve your business from the inside out?
Connect with one of our insurance experts today for a free online short term disability Insurance:
Email us at info@mintcoFinancial.com
Call us 813-964-7100