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Understanding The Basics Of Your Short-Term Disability And Long-Term Disability Coverage

January 5, 2017

What is Short-Term Disability?

Short-term disability (STD) insurance covers a percentage of your income when you cannot work due to a temporary disability.  Short-term disability policies generally begin shortly after you become unable to work, often 1-2 weeks, and typically last for a period of 3-6 months.  Short-term disability insurance is often used to cover conditions such as temporary injuries, surgery rehabilitation, pregnancy, and other situations from which a person recovers in a matter of weeks or months.

What is Long-Term Disability?

Long-term disability (LTD) insurance covers a portion of your income if you have a disability that prevents you from working for a longer period of time.  Typically, long-term disability policies include a waiting period, ranging from 90 to 180 days depending on your specific policy.  Claimants must meet their policy’s definition of disability throughout this period before their insurance company will begin paying benefits.  Long-term disability insurance covers longer-lasting conditions, and those that cannot be treated, including things like chronic conditions, cancers, immune disorders, and neurological conditions.

How Do I Get Short-Term Disability or Long-Term Disability Coverage?

Both short-term disability and long-term disability insurance can be provided through group plans and individual policies.  In a group plan, your disability coverage is received through your employer as an employee benefit.  Employees may still be responsible for the full cost of the coverage, although group rates will likely be less expensive than paying for an individual policy.  An individual disability policy is one you purchase yourself directly from an insurance company.

While group plans are generally less expensive for the insured, they tend to be more restrictive.  With a group plan, you must use the insurance company and plan selected by your employer.  This means that you are limited to the coverage outlined in the policy your employer has chosen.  Individual policies, while pricier, allow for more individualized coverage.  You may be able to select your definition of disability, how long you receive benefits for, or benefit limitations.

Some people choose to have both types of plans, supplementing their group disability coverage with an individual policy.  An individual policy can cover the income that is not covered by your group plan.

Long-Term Disability Insurance: Definition of Disability

How Can Short-Term Disability and Long-Term Disability Work Together?

If you find yourself unable to go without income during the required long-term disability waiting period, short-term disability benefits may be able to cover you in the interim.  Most short-term disability policies will last for the entire long-term disability waiting period, after which point you may transition to long-term disability benefits.  Alternately, your temporary condition could become a more long-term issue.   If you have received the maximum amount of STD benefits under your policy but are still unable to work, you may be able to transition to long-term disability benefits.

Definition of Disability in Your Plan

Meeting the definition of disability in your short-term or long-term disability policy is a crucial part of the disability insurance process.  This definition identifies the terms you must satisfy in order to receive benefits.

There are two common definitions of disability – the own occupation definition of disability and the any occupation definition of disability.  The own occupation definition of disability asks whether you are able to perform the material duties of the job you were engaged in at the time you became disabled.  The any occupation definition of disability questions whether you can perform the material duties of any occupation in the workforce.  Some policies will ask if you are able to engage in any “gainful” occupation.

Most short-term disability policies require you to meet the own occupation definition of disability.  This definition typically remains the same for the duration of your short-term disability claim. Most long-term disability coverage includes both an own occupation definition of disability and an any occupation definition of disability.  Long-term disability insurance will generally require you to be disabled from your own occupation initially, but after a certain period, often 24 to 48 months of benefits, it will transition to the any occupation definition of disability.


Most employer-sponsored group short- and long-term disability plans are governed by a federal law known as ERISA.  ERISA was enacted to protect employees against mismanagement of pension plans or employee benefit plans by their employers, but in turn, it can impose stringent requirements on policyholders.

Under ERISA, your disability claim may be subject to strict regulations and restrictions.  As a result, ERISA often works in favor of insurance companies rather than the insured.  For example, claimants appealing a denial or wrongful termination of benefits must submit all relevant evidence during the appeal stage, as new evidence generally cannot be introduced in court.  Plans governed by ERISA also impose strict deadlines, and missing one means you could be subject to a claim denial or may lose your right to benefits completely.  Furthermore, under ERISA, failure to exhaust administrative remedies could mean you lose your rights to your benefits entirely.  This might occur in a situation in which you missed a plan deadline and, as a result, your insurer is unwilling to consider your appeal.

Employers and insurers also have responsibilities under ERISA.  Your plan administrator must provide plan-governing documents upon written request of the insured and, following a claim denial, the insurer must provide copies of all relevant documents and information if requested.

It is important to note that ERISA typically does not apply to individual disability insurance policies that you purchase yourself directly from the insurance company.    However, in some cases ERISA may potentially apply to individual policies obtained through your employment.  With an individual plan, you have the right to a jury trial and are not subject to the same strict regulations as those under ERISA.

Short-term disability and long-term disability plans can be complex.  Ensuring that you have the right evidence to satisfy your definition of disability or transitioning between plans can be overwhelming and difficult.  If your short- or long-term disability claim has been wrongly denied, you may find yourself facing a complicated appeal.  While claimants can handle the process of filing for short-term disability or long-term disability on their own, it may be prudent to enlist the help of a lawyer.

The legal team at Chisholm Chisholm & Kilpatrick understands the complex law and processes that come with applying for disability insurance.  Understanding your rights under a short-term or long-term disability plan, or transitioning between plans, can be difficult, especially while you are managing an injury or illness.  Our lawyers can help you understand your rights and navigate this process with ease.

Our lawyers will analyze your policy to determine the types of evidence necessary to support your claim.  Insurance companies are not always easy to work with, so we can act as an intermediary between you and your provider.  We will try to ensure that your insurance company handles your claim fairly and in good faith.

CCK attorneys are experienced in ERISA law.  If you have a group disability policy and need assistance appealing a denial or are facing ERISA-related litigation, our legal team can assist.  We understand the intricacies of ERISA and state law surrounding short- and long-term disability insurance and want to help you receive the benefits to which you are entitled.

Contact Chisholm Chisholm & Kilpatrick for A Free Consultation Today

If you need assistance with a short-term disability or long-term disability claim or appeal, the lawyers at Chisholm Chisholm & Kilpatrick are able to help.  We represent claimants with group or individual policies and assist those applying for benefits for a variety of different conditions.   It is important that you understand your rights, requirements, and your policy as you navigate the process for disability insurance.  For a free consultation with a member of our team, you can contact us online or call us at 800-544-9144.