Types of Disability Insurance

Marshall & Sterling Insurance can work with you to develop a disability insurance program that meets your company's needs and budget or to evaluate and revise your current disability program.

Short-term disability insurance

Short-term disability insurance programs usually run for approximately 13 to 26 weeks, but some continue for as long as one year. Benefits under short-term programs usually range from 50 percent to 67 percent of an employee's pay, subject to a weekly maximum. There may be a waiting period of 1 to 10 days before the employee is eligible to receive short-term benefits. However, if the employee is hospitalized or involved in an accident, there is often no waiting period.

About half of employers with short-term disability insurance self-insure, according to Bureau of Labor surveys. The other half use commercial carriers.

Long-term disability insurance

Long-term disability insurance programs begin after short-term benefits have been exhausted, usually three to six months after the onset of the illness. Benefits cover 50 percent to 67 percent of an employee's pay and are often subject to a monthly maximum. If the employee is also receiving other benefits, such as Social Security, long-term disability benefits may be reduced proportionately. Benefits generally end at age 65 or 5 years after the disability begins.

The vast majority of employers with long-term disability plans use commercial carriers, according to Bureau of Labor surveys.

Wage and salary continuation plans

Some employers provide the equivalent of disability insurance through wage and salary continuation plans. If such a plan provides full pay, compensation from other sources, such as workers' compensation, is often deducted. Integrated disability programs Integrated disability programs allow employers to provide a more comprehensive health and disability insurance program while at the same time cutting overall costs by reducing administrative costs and by getting disabled employees back to work sooner. Integrated programs allow employees to have the same health care professionals provide care for work-related injuries and illnesses, nonwork injuries and illnesses, and other health problems. A single managed care program takes care of all the employee's needs. Case management techniques and early intervention are aimed at returning employees to work as soon as possible.