Long Term Disability insurance and Social Security Disability Insurance share many similarities, but there are key differences you should know. Our Maitland Long Term Disability lawyer explains.
It is important that you know every avenue to pursue disability benefits should you need them. You may already be contributing to your SSDI through your employer; do you need to add a Long Term Disability policy? Here, we discuss what makes these two disability programs different and how you can use both of them to maximize your disability benefits.
What Is SSDI?
Social Security Disability Insurance is insurance provided by the Social Security Administration and is paid, in part, by your Social Security taxes. The current Social Security tax rate is 6.2% paid by the employee and 6.2% paid by the employer. Self-employed workers pay the full 12.4%.
However, paying Social Security taxes does not automatically qualify you to receive Social Security benefits. You must earn work credits based on your income. Each year, you can earn up to four credits, and you need 40 credits to qualify for SSDI benefits, 20 of which must be earned in the last 10 years before becoming disabled. That said, younger workers can qualify with fewer credits.
How Does SSDI Differ From Long Term Disability?
Long Term Disability insurance also pays benefits to individuals who have become unable to work due to illness or injury. The main difference is that Long Term Disability benefits are paid from a private insurance company like Guardian, MetLife, New York Life, and others. You and your employer often share the cost of your insurance premiums. Some employers do not offer Long Term Disability insurance; in this case, the individual can purchase an individual policy.
Both types of disability insurance typically have a waiting period before you are eligible for benefits. During this time, you can file for Short Term Disability benefits through your employer or insurer.
Do You Need Long Term Disability Insurance And SSDI?
Our Maitland Long Term Disability lawyer will tell you that to receive the benefits you need, it is in your best interest to use both types of disability insurance if they are available to you. Did you know that one-quarter of today’s 20-year-olds will become disabled before age 67? Social Security Disability Insurance does not pay benefits unless your disability is considered catastrophic, and even then, the payments may not be enough for most people to live on.
Not only are Long Term Disability benefits easier to qualify for than SSDI, but the payments can also be more generous. Why do more people not get Long Term Disability insurance coverage? The main prohibitive factor is cost. For a comprehensive plan, LTD premiums are typically 1% – 3% of your annual income. Note that this cost is much lower than the 12.4% you pay into SSDI. The benefit amount of a Long Term Disability policy should replace between 60% – 80% of your after-tax income. You can see why these individual insurance policies are worth having.
Can Disability Claims Be Denied? 
Unfortunately, the denial rate for SSDI is relatively high. About 63% of SSDI claims are denied based on several factors:
- Lack of medical evidence
- Too much in earnings
- Prior denials
- Failure to follow treatment advice
- And more
Your Long Term Disability claim may also be denied for similar reasons, including:
- Insufficient medical evidence
- Failure to meet your policy’s definition of disability
- Inconsistent evidence
- Missed deadlines
- Errors on your claim
- Conflicting medical assessments
- And more
What Can You Do If Your Claim Is Denied?
If your Long Term Disability claim has been denied, your best option is to hire an experienced Maitland Long Term Disability lawyer. Our team at Herbert M. Hill, P.A. knows how to work with the medical community and insurance companies while protecting your interests. Contact us to discuss your case and see how we can help you get the benefits you are entitled to.