Long-term disability (LTD) insurance and Social Security Disability Insurance (SSDI) can both offer support to those who can’t work because of a disability. While both programs can provide critical financial assistance, they differ in their eligibility criteria, potential benefit amount, and how to file a disability claim or appeal.

Understanding your options for SSDI and LTD will help you get the disability benefits you’re entitled to at a challenging time. We strongly recommend consulting a disability lawyer to help you file a claim or appeal. SSDI law and long-term disability law are vastly different, so you should seek an expert who specializes in the area of the law relevant to your claim.

In this article, we’ll explore the key differences between long-term disability and Social Security disability to help you make informed decisions about your financial well-being. We’ll also discuss frequently asked questions about how these two programs work together and how their interaction might impact your benefits.

Here’s what we’ll cover:

Understanding disability benefits

No one plans on becoming disabled and losing the ability to work, but it’s more common than most people think.

For today’s 20-year-olds, there is over a 25% chance that they will experience a disability lasting at least a year before they reach retirement age. A disability can have a devastating impact on your income, not to mention your mental health and overall well-being.

You may have multiple options available to help you bridge the income gap and gain some peace of mind. Among the various types of disability benefits available for those with severe conditions are long-term disability and Social Security disability benefits.

What are Social Security Disability Benefits?

Social Security Disability Insurance (SSDI) is a government program offered through the Social Security Administration that provides financial assistance to people with disabilities. You earn SSDI benefits by working and paying Social Security taxes.

What are Long-Term Disability Benefits?

Long-Term Disability (LTD) insurance is most commonly an employer-sponsored benefit as part of an employee benefits program. You can also purchase coverage independently through a private insurance company — typically for a much higher cost. In either case, the terms of the disability coverage are laid out in a private disability insurance policy.

You might have a long-term disability plan through your employer and not even know it. Be sure to check with your HR department to understand what benefits may be available.

Learn the difference between ERISA and Individual Disability Insurance.

Eligibility and Filing a Claim

Qualifying for SSDI benefits

To be eligible for SSDI benefits, you must have worked in jobs covered by Social Security and meet the definition of disability under the Social Security Act.

To qualify as disabled under SSDI, you must show that you can’t perform the material duties of your job or “any occupation” because of your disability. You must also provide medical evidence that your disabling condition is likely to last at least a year or result in death.

SSDI doesn’t cover short-term or temporary disabilities, and there is generally a five-month waiting period or elimination period before benefits will begin.

Because Social Security disability eligibility requirements are so strict, SSDI benefit recipients are typically the most severely disabled in the country. Based on a recent survey, only 14% of adults with disabilities aged 18-64 receive benefits from the Social Security disability program.

You can apply for SSDI benefits online, by phone, or in person at your local Social Security Administration office. Be prepared to provide detailed information about your medical condition, work history, and other relevant documentation.

Qualifying for long-term disability benefits

To qualify for LTD benefits, you must satisfy all of the insurance policy’s terms, including the definition of disability, waiting periods, and any pre-existing condition clauses.

Under most LTD insurance policies, you must be unable to perform the essential duties of your job, often defined as your “own occupation” or “regular occupation” due to a disability. The definition of disability in your policy may change after a certain period, usually 24 months, at which point it often becomes more difficult to prove disability. as you may have to show you are unable to work in any occupation from that point forward. Some policies will also exclude coverage for various reasons like pre-existing conditions, while others may limit benefits for certain medical conditions like mental health.

To qualify for LTD benefits, you must satisfy all of the insurance policy’s terms, including the definition of disability, waiting periods, and any pre-existing condition clauses.

You also are generally not entitled to LTD benefits from the date of disability. Usually the policy contains an elimination period, where you have to remain disabled for a period of time before your benefits kick in. The elimination period for LTD benefits can vary, but it typically ranges from 30 to 180 days. In the meantime, you may need to rely on short-term disability benefits or other state programs, if available, such as the Washington State Paid Family and Medical Leave program.

Read more here about how long it can take to get long-term disability benefits.

The burden of proof is on you to show that you fulfill the requirements outlined in your long-term disability insurance policy. Be sure to consult your policy for details, as every policy and every insurance company may have different criteria you must meet.

Benefit Amounts

SSDI benefits

Your work history and average lifetime earnings before you become disabled will determine how much Social Security disability benefits you can receive.

The benefit amount from Social Security disability insurance is typically modest — the average monthly benefit from SSDI in 2024 was only $1,483.10. You might also be able to boost your SSDI payments with Supplemental Security Income (SSI).

LTD benefits

Most ltd insurance policies pay 50-70% of your income before becoming disabled. This percentage can vary based on the specific terms of your policy, so it’s essential to review the details carefully.

FAQs: SSDI and LTD Benefits

Can you collect both long-term disability and Social Security disability?

Yes, you can receive both long-term disability and SSDI benefits at the same time. However, your insurance company may reduce the LTD benefits you qualify for by the value of your monthly benefits from Social Security disability. Private insurance companies may even require you to file for Social Security disability benefits so they won’t have to pay you as much of a benefit.

Do I have to pay back long-term disability if I get SSDI?

If you receive back pay from Social Security to cover the period from when you applied for benefits to when you were approved, your insurance company may be entitled to this amount as reimbursement and a reduction of your LTD benefit amount going forward. Insurance policies are complex, so we strongly recommend consulting a long-term disability lawyer to help you navigate the details. Insurance companies may miscalculate the amount you owe them (in their favor, of course), but an experienced LTD lawyer can help protect your rights.

Should I apply for both SSDI and LTD benefits?

Yes, it’s a good idea to apply for long-term disability and Social Security disability at the same time. By applying at the same time, there will be less of a chance that your long-term disability benefits will take a hit later on when your Social Security benefits go into effect.

Will getting approved for SSDI boost my chances of getting LTD benefits?

Yes, being granted benefits for Social Security disability can improve the likelihood of also being approved for long-term disability benefits. Many LTD policies have requirements that are similar to SSDI, so meeting SSDI criteria can significantly support your claim for LTD benefits. Also, many insurance companies encourage claimants to file for SSDI because the benefit can offset the LTD payment they must pay you.

What do I do if my disability claim is denied?

If your disability claim is denied, don’t lose hope. There are steps you can take to appeal the decision. You should seek the help of a disability lawyer specializing in the area of the law that is relevant to your case. Hiring a lawyer with the necessary expertise and experience will ensure you get the best possible guidance for your situation.

Our team at Roy Law Group specializes in ERISA and long-term disability law, and we can handle all aspects of filing your LTD claim or appeal. We don’t take on Social Security cases; however, we can refer you to an SSDI lawyer if needed.

Summary of long-term disability vs. SSDI

  • Social Security Disability Insurance is a government-sponsored program, while long-term disability insurance is a private insurance program governed by a private disability insurance policy.
  • Both SSDI and LTD benefits offer financial assistance for an extended period, but the benefit amount will vary based on your situation.
  • You can collect both SSDI and LTD benefits simultaneously, but LTD benefits may be reduced based on SSDI payments, and tax implications vary based on premium payments.
  • Consulting a qualified disability lawyer is crucial for navigating claims and appeals, as they can provide specialized guidance and improve the chances of a successful outcome.

Still have questions? Contact our team at Roy Law Group for a free consultation about your long-term disability claim or appeal.

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