Short Term Disability Insurance
Short term disability insurance provides money to workers who are injured, seriously ill or pregnant. All types of disability insurance will pay a percentage of your original income for a set period of time. If you need assistance for less than a year, then you should apply for short-term disability insurance. However, if you were hurt on the job, then you will need to apply for Worker's Compensation. If you require 3-5 years or more to recover, then you will need to first apply for short term benefits and then apply for disability insurance long term once your temporary benefits expire.
One type of short-term disability insurance applies to the states of California, Hawaii, New Jersey, New York and Rhode Island only. These locations offer State Disability Insurance benefits, which may also be referred to as temporary disability insurance. When a person comes down with an illness or non-work-related injury that is expected to last for a short amount of time, they can receive partial wage replacement under this program. These state programs pay maternity disability benefits for pregnancy and childbirth as well.
Workers may be able to go back to work -- either with the same employer or a different employer -- and will still receive a certain percentage of their new pay. The money for these programs is paid through automatic payroll deductions, so any non-government employee is eligible, even if they are currently out of work. (However, they will not be eligible for SDI and unemployment insurance at the same time.)
To be considered for short-term disability insurance, the Social Security Administration definition is used: "the inability to perform any substantially gainful activity because of a medically determinable physical or mental impairment. The condition must be expected to last for more than 12 months or result in the applicant being deceased." In California, New York, Hawaii, New Jersey and Rhode Island, there are two state disability benefits available: the voluntary plan (covered automatically by payroll deductions) or elective coverage (for self-employed individuals who may opt into the system by paying an annual fee). The State Disability Insurance benefits can be paid for a maximum of one year, with a seven day waiting period. If the disability is expected to last longer, the individual will have to apply for long term disability insurance once the short-term coverage expires.
If your employer does not cover short-term disability insurance, if you're not working more than 32 hours or if you are self-employed, then you may need to look into individual disability insurance. However, "There are only a few companies that offer disability on a direct basis," says Karen Riedel, a vice president and director of product marketing for Aflac. Though Aflac does not offer benefits directly to individuals, you can try the following top insurers: Hartford Life, Lincoln Financial Group, Unum, Aetna, Sun Life Financial, MetLife, CIGNA, Reliance Standard, Standard or Prudential. Generally speaking, these policies are a good idea if you do not have adequate savings to cover an emergency.
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