Group Disability Insurance

Group Disability Insurance is a good start for financial protection from a

disability. There is long term disability insurance (LTD) and short term disability insurance (STDI) in a Group Health Insurance plan The group plan can be designed with one or both with LTD being the most popular.

The STDI coverage can start as early as the first day after an accident and the first week upon diagnosis of an illness. The short term disability coverage will generally have a maximum weekly benefit amount that is a percentage of earned income

The LTD coverage starts after an elimination period of 30, 60 or 90 days. The elimination period is a waiting period from the start of disability to the time a long term benefit is received. This is why short term coverage can be important. The benefit paid is based on a percentage of income (usually 66%) and lasts for a certain period depending on the plan design. The time period that the benefit is paid for can be 2 years, 5 years or to age 65 (assuming the insured meets the definition of disability during this time period).

An optional benefit that should be added is COLA – Cost of Living Adjustment. This means that while an insured is on a claim the benefit amount will be increased to keep up with inflation. This is an incredibly important coverage to add to any long term disability insurance plan.

As good as group disability coverage is there are limitations that can be filled with Supplemental Disability Insurance.

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