Short-term disability insurance simplified—we got you covered

If you have an illness or injury that makes you unable to do your job, you may qualify for short-term disability insurance. With a valid policy, short-term disability replaces part of your income for a short period of time, typically from nine weeks to a year, when you are injured or ill and unable to work.

Let’s take a closer look at short-term disability, and what you need to know about going on this type of insurance.

What is disability insurance?

Disability insurance pays a partial amount of your income if you have an illness or injury that prevents you from being able to work. There are two types: short-term disability, for health circumstances that take you out of work for a few weeks or months, and long-term disability, which covers you possibly indefinitely.

“If you have a sickness or illness and you are unable to perform the material duties of your occupation then you are meeting the definition of disability,” says Joseph McDonald, a partner at McDonald & McDonald, an Ohio-based law practice specializing in disability insurance claims.

What is short-term disability insurance?

Short-term disability insurance offers partial income for a temporary amount of time to workers suffering an illness or injury. Childbirth and the first few months of caring for an infant may also be covered under short-term disability insurance.

“Every company is different in how long short-term disability lasts. [It could be] three months to six months,” McDonald says. “Some employers may have them longer.” Short-term disability covers 50% to 60% of a worker’s monthly income and in most cases, people out on short-term disability are able to return to their jobs, McDonald says.

When you have an incident that requires you to make a claim for short-term disability, you'll likely have a waiting period during which you will not receive benefits. Upon approval, you’ll also be told how many weeks you may collect benefits before they expire.

How do you get short-term disability insurance?

First, check with your employer. You may already have short-term disability coverage as a benefit for your job and in some cases your employer pays for this coverage. Some employers may also offer the option to purchase additional supplemental insurance from places like Aflac or Unum. If you don't have benefits through employment, some private insurers may also be able to offer coverage: Mutual of Omaha, Assurity, State Farm, and LifePreserve offer short-term disability insurance to individuals.

In addition, 11 states—California, Colorado, Connecticut, Hawaii, Maine, Massachusetts, New Jersey, New York, Oregon, Rhode Island, and Washington, plus the District of Columbia—offer state-sponsored short-term disability programs. Eligibility rules, application process, benefit payout, and length of programs vary greatly from state to state, Bradshaw says. For example in Colorado, participants get 60% of their earnings, weekly maximums of $3,000, and there is a waiting period of 30 days. In California, participants get 55% of weekly earnings with a minimum benefit of $50 per week and a maximum benefit of $1,540.

What will short-term disability insurance cost me?

Many employers offer short-term disability insurance to their employees as part of a standard benefits package. You may also have to opt in and pay for it, though it’s usually a nominal amount, says McDonald. Short-term disability insurance is also available in the private insurance market from companies at rates from $120 and up per year, depending on coverage.

What types of conditions are covered by short-term disability?

A wide range of medical circumstances, including illnesses and injuries, are covered by short-term disability insurance, says Erin Bradshaw, chief of mission delivery at the Patient Advocate Foundation. Examples include:

• An accident outside of work that has made the person unable to work due to the recovery period
• A surgery for a condition that will require recovery for a short period of time
• A cancer diagnosis with a treatment will impact the ability to work

How do I use short-term disability benefits for childbirth?

A short-term disability policy may be a good option to cover some lost wages during maternity leave if you’re self-employed or a company doesn’t offer paid leave.

With most short-term disability plans, your coverage begins two weeks before the baby is born and the coverage ends six weeks after the baby’s birth. As with any such claim, your short-term disability benefit is a percentage of your earnings. Once the waiting period is over, you’ll receive a weekly or biweekly check to help pay for the expenses of caring for a newborn while you recover at home.

For example, with Unum short-term disability insurance, deliveries without complications are approved for short-term disability for a period of six weeks. An eight-week benefit period might be approved following a Cesarean delivery. These benefit periods include elimination periods or waiting periods during which no benefits are paid. So if the waiting period is one week, the short-term disability would cover five weeks of payout for a normal delivery and seven weeks for Cesarean delivery.

You should also note that you may need to sign up for some private or supplemental short-term disability policies before you become pregnant in order to qualify for short-term disability. For instance, Aflac will not pay benefits for a short term disability caused by pregnancy or childbirth within the first 10 months of the effective date of coverage. So, if you're planning for a family, you will want to plan well in advance.

Do I need to see a doctor to qualify for short-term disability?

See your doctor about your illness or injury as soon as possible—both for treatment, and to establish a medical record to support your short-term disability claim. “Have a thorough conversation with a doctor, how you’re struggling, and what you can’t do.” McDonald says. “You should have a real clear idea on why you can’t work.”

Be sure to retain records such as X-rays and medical reports, which the short-term disability insurance company may require that you provide when you make your claim.

Where can I learn the details of a short-term disability policy?

To learn the specifics of short-term disability insurance, you’ll have to dig into the policy. “All disability plans vary in waiting periods, disabilities covered, benefits offered, and exceptions,” Bradshaw says. “Be sure to read your policy for exact details.” Exceptions to short-term disability coverage may include self-inflicted injuries and injuries that occurred during illegal acts.

To avoid any delay in short-term disability benefits, provide all the necessary information to the insurance company. “Understand the benefits and timeline of eligibility and provide all required information [and] medical requests to avoid any pause or [termination] of benefits,” Bradshaw says.

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