Disability insurance: a primer on coverage

If both you and your spouse are working, one policy may be enough. "If you're in a family where you have two breadwinners, but one makes 75 percent or 80 percent of the combined income, maybe you don't need to insure both," Hunter says.

Social Security disability insurance

Even if you have private long-term disability insurance coverage, you are likely to file a claim for Social Security benefits if you're laid up for a lengthy period of time.

"People who are on long-term benefits -- and this is a general rule because it really depends on the policy -- are required to apply for Social Security disability insuranceafter they've received private long-term disability for about two years," says Ray Cebula, a faculty member at the Employment and Disability Institute at Cornell University in Ithaca, N.Y.

The Social Security Administration pays two types of benefits to disabled workers: Social Security Disability Insurance and Supplemental Security Income. SSI applies to workers who don't have enough earnings credits to be eligible for Social Security retirement benefits.

To qualify for Social Security disability benefits, your condition must be expected to either last at least one year or be terminal. Even though you cannot begin receiving Social Security benefits until you have been off work for at least 12 consecutive months, you should still apply as soon as you become disabled, especially if you have no other disability insurance.

The Social Security Administration estimates that the application process takes three to five months. The SSA reviews your application -- complete with your medical records and work history -- and forwards it to your state’s Disability Determination Services office if your work history meets the basic requirements for eligibility. While the state agency makes the decision on your claim, it follows a uniform set of SSA rules.

Your doctors will be asked to provide information about your medical condition, but you also may submit any medical records you have in your possession.

"That evidence may be enough for us to make a decision in that case," SSA spokeswoman Dorothy Clark says. "And that cuts down on the processing time of that application."


If your application is approved, you'll receive a letter that tells you the amount of your benefit and the date your payments will begin. If your application is denied, the letter will give an explanation as well as information on how you can appeal.

In 2008, the average monthly benefit awarded to disabled workers under SSDI was $1,063.10, according to the SSA's annual report on the Social Security Disability Insurance Program. Social Security benefits are paid through the sixth full month after the date your disability began, and the first check arrives the month after your eligibility period starts.

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