Important points about private long-term disability insurance

| Mar 20, 2020 | Blog

Disability insurance can be vital for New Jersey residents to be prepared for unexpected occurrences that leave them unable to work. It could stem from an injury or illness. Regardless of how it happened, knowing the basics of long-term disability is integral to making an informed decision as to whether it is preferable to short-term disability.

Short-term and long-term disability insurance have advantages and disadvantages. Long-term disability will provide benefits to people until they reach age 75. Short-term disability will cover them for up to two years. There are waiting periods for both. With long-term disability, it is up to two years, but it will generally start after three to six months. Short-term disability can start immediately or within 14 weeks. For long-term disability, the person will get 70% of their current salary. With short-term disability, it is usually 80% or more initially, and then it reduces.

Long-term disability gives solace to those who are concerned about what will happen if they become disabled. Since the benefits extend to age 75, they will not need to think about how they will survive financially. The amount a person receives is also set and can pay up to 70% of what the person was earning at work. This salary will continue for the duration of the disability. It can also cover for hospitalizations.

Still, long-term disability insurance is costlier, and the waiting period leaves the person without income for up to six months. A common issue with long-term disability insurance is what will happen if the claim is denied. Whether the insurance is through ERISA or a private insurer, having legal assistance may help ensure that the claim is assessed fairly. A law firm experienced in private long-term disability cases may be able to help.