How to Buy Short Term Disability Insurance
Many people purchase short term disability insurance to protect them during work absences that last up to 26 weeks. Common situations that warrant the use of a short term disability policy include pregnancy, back injuries and other conditions. Short term disability insurance is available through employers or as a private policy. But before making a purchase, it helps to have a few tips.
Instructions
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Check out group short term disability insurance. This type of insurance is purchased through your current employer. Some employers foot the total cost. Others require employees to pay a portion of the cost, usually through paycheck deductions.
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Consider a private policy. If you're self-employed, or have an employer that doesn't offer this benefit, you can purchase your own policy. A variety of companies offer these policies, including Aetna, MetLife and CIGNA (see Resources).
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Determine the appropriate level of coverage. An employer-sponsored plan typically pays up to 70 percent of your salary. However, private policies vary, and you may need to pay more for a higher level of coverage. In addition, your employer's short term disability plan may last up to 26 weeks. A private plan may offer more flexibility.
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Ask about medical exams. Most employer-sponsored plans require no physical exam, but private insurers may. During an exam, you may be required to provide blood and urine samples, which could be tested for diseases and tobacco use. Most insurance companies will have a nurse visit your home to collect the required samples.
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Tips & Warnings
Understand the fine print in your policy. If you purchase an employer-sponsored plan, you may be required to use all of your sick days before tapping into disability insurance. In addition, you may have to be a full-time employee to be eligible.
Don't be surprised if there's a waiting period. For example, you may have to be disabled for at least two weeks before tapping into your short-term policy.
