Disability Insurance: Private Vs. Government
If you are injured in an accident or fall ill and are unable to work as a result, you're going to need payments from a disability insurer to replace as much of your lost income as possible. Two main types of insurance programs are involved in these situations: private companies and government programs. Here is a look at these two types of insurers and how they interact.
The main government program for disability insurance that is not related to an injury on the job is the Social Security Disability Insurance program, typically called by its acronym, SSDI. This program is available to all workers who have been employed long enough to qualify.
The program is funded by the social security taxes that your employer takes out of your paycheck. SSDI differs from the other big government disability program, workers compensation in that the disability does not have to be caused by an accident at the workplace.
The requirements for obtaining disability benefits from SSDI are generally rather strict. You must not only demonstrate that you can no longer do your current job, but you must also show that you cannot adapt to any other type of employment either.
In addition to having access to SSDI through paying their social security taxes, many people have access to private disability plans through their place of employment as well. The employer might pay for all or part of the insurance or offer it at a discount as a benefit. You also have the option of buying private disability insurance as an individual on the open market.
An advantage of having private disability insurance is that their definition of "disabled" is often less stringent than that of a government program such as SSDI. This means it's generally easier to start getting payments to replace your lost income through a private insurer than through a government agency. Also, in most cases, a private insurer will pay a larger amount of benefits than SSDI.
If you become disabled, you do not necessarily have to choose between getting benefits from a private insurer or from SSDI. It's possible to receive payments from both at the same time. Some private insurers might actually require you to apply for SSDI benefits to receive payments from the private company. They might then deduct your SSDI payment from your private disability payment.
The issue of obtaining disability payments from either a private or government insurer is complicated and you will need expert help to navigate the process. For more information contact a disability claims attorney.