Short term disability insurance and family medical leave

Submitted by Anonymous (not verified) on Mon, 05/03/2010 - 09:58

I've often been suggested to apply for Short term disability insurance before I go on a maternity leave. Do I really need it?

Posted: 03 May 2010 11:04 Post Subject:

Are you currently pregnant? If so, don't bother to apply for a new life/health/disability insurance policy . . . you have a preexisting condition that could result in a disability or death. Although perfectly healthy when looking at yourself in a mirror, you may not look that way to an insurance company on paper or in person.

If what you're asking is, "Can I make a claim for short term disability benefits under a policy I already have because I'm pregnant?" The answer is: maybe. It might depend on how long you've been insured -- it could still be considered a preexisting condition. Or not. To collect a benefit, you'll have to satisfy the definition of "total disability" in the policy, which could be "any occupation" or "own occupation", the former being harder to qualify for benefits.

On the other hand, state programs such as CA State Disability Insurance specifically list pregnancy as an allowable condition for triggering benefits, and you can collect from about a week after you first leave your employment through several weeks or more after having given birth. Rules vary from state to state, as do benefit amounts, so you need to do some homework there.

Posted: 04 May 2010 05:39 Post Subject:

No Max, I'm not pregnant. I just have a feeling that my time is running out. I'm 30 and I have this feeling that I should try it within the next 2 years.

Posted: 04 May 2010 12:49 Post Subject:

Great! Feel free to apply for a short term DI policy. If pregnancy is your primary concern, then you'll want a policy that has a relatively short elimination period, such as 14 or 30 days. A shorter elimination period will increase the cost of the insurance, but start your benefit sooner.

Be sure that the policy you obtain does not exclude pregnancy as a covered disability. Some do exclude it entirely, most exclude it if the pregnancy is expected to "terminate normally" (by giving birth) within 10 months of issue date (pre-existing condition). Unanticipated complications of pregnancy are not normally excluded (i.e., miscarriage, induced labor/abortion to prevent death of the mother), because the duration of the disabling effects of these events is usually too short to trigger benefits.

And you probably want the definition of disability to be stated as the inability to perform the duties of your "own occupation" (not the duties of "any occupation"). That, too, will make the policy a bit more costly, but easier to qualify for benefits.

Feel free to ask more questions.

tick . . . tick . . . tick . . . :roll:

Posted: 05 May 2010 05:41 Post Subject:

Hi Max...thanx so much for all the information.

That, too, will make the policy a bit more costly, but easier to qualify for benefits.

I just didn't understand how the "own occupation" thing makes it different than the "any occupation" thing.

Posted: 05 May 2010 02:25 Post Subject:

The 'any occupation" definition of disability is usually written in a way that a person is only disabled if they "cannot perform the duties of any occupation for which you may be suited by reason of education, training, or prior experience." It is restrictive in the sense that there may very well be some type of work a person can do with certain disabilities that would otherwise prevent them from doing their customary work.

The "own occupation" definition considers a person disabled when they "cannot substantially or materially perform the customary duties of your occupation at the time you became disabled." Much easier to qualify for benefits. If your work requires that you sit at a desk pounding away at a computer keyboard, and you cannot do that, you are disabled under this definition, where you might not under the "any occ" definition, because there could be other work your could do that did not require sitting for extended periods of time (like passing burgers over the counter at a fast food place).

Posted: 07 May 2010 10:04 Post Subject:

There is no argument over the fact that short term disability insurance is indeed good for pregnancy. It replaces our income quite steadily. It helps us to get compensated for any complications that may arise during pregnancy.

Posted: 08 May 2010 07:24 Post Subject:

I'm sure there are some states where in short-term disability insurance is mandatory. They'd go for a payroll deduction in order to fund such coverage. I guess the states are - NJ, NY, CA, HI and RI.

Posted: 08 May 2010 01:29 Post Subject:

There are probably many more states with their own Disability Insurance programs than the 5 you list. California's SDI program is funded with a 1.1% mandatory contribution via payroll deduction up to about $96,000 in income. Excess contributions (due to payroll accounting errors, or multiple employments) are refundable and credited against any income tax due for that year when the person files their income tax return.

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