Are Your Expectations Regarding Social Security Disability Insurance Realistic?

Q: Can I count on Social Security Disability Insurance Benefits alone to support me and my family or should I get private disability insurance?

They say the only sure things are death and taxes.

Maybe that kind of thinking is why most Americans have– or at least acknowledge– the importance of life insurance. Sadly, most people don’t place the same value on disability insurance. And the reality is you’re more likely to become disabled than you are to die before reaching retirement age. Just ask an experienced Social Security Disability law attorney.

So what are you thinking?

Perhaps you are relying on taking advantage of Social Security Disability Insurance (“SSDI”) if you become physically or mentally disabled. But will you qualify for those benefits and if so, will that income be enough to sustain you and your family?

SSDI is a benefit where the government provides financial compensation if you become “disabled” before age 65 and are no longer able to work. As long as you fall within the criteria of “disabled” and have the requisite number of work credits, you may be eligible to receive SSDI. It’s a work-based system that examines how long– not how much– you paid into the system through income tax contributions while you were able to work. Unlike another government-sponsored disability benefits program known as Supplemental Security Income or (“SSI”), SSDI is not based on your financial situation.  

A qualifying “disability” for SSDI is defined as “the inability to engage in substantial gainful activity due to a medically determinable impairment that has lasted or is expected to last a minimum of 12 months or result in death”. There are many health problems that may qualify as disabling conditions and can be either physical or mental impairments.

The SSDI application process can be daunting and denials of benefits are common. Hiring an experienced SSDI attorney from the outset or at any point along the SSDI appeals process, may increase the likelihood of obtaining benefits.

SSDI payments are not connected to the severity of your disability or your current income or need, but rather are based on your average lifetime income before you became disabled, with the majority of people receiving $700-$1,700 in SSDI benefits per month. The 2017 average monthly disability benefit is $1,171 and the maximum monthly benefit this year is $2,687 for those on the higher end of the average lifetime income spectrum.

Would your SSDI entitlement be sufficient for your family to live on and can you wait the many months it may take for approval and receipt of the first check?

Some people, generally those whose employers offer it, purchase private disability insurance. Such private policies differ vastly in their cost, terms, definitions, and how claims are submitted and paid. Policies may cover either short-term disability STD or long-term disability LTD and sometimes will cover both. Some important terms to check out when considering private insurance include elimination periods, length of payout limitations, and in the case of an employer-based plan the percentage of the employee’s income contribution that is required. It is a personal decision.

It’s also important to note that while you can generally collect both SSDI benefits and private disability insurance benefits simultaneously, if there is a Social Security benefits offset clause in your private policy, the benefits paid from your private insurance plan will be reduced (off-set) if you are simultaneously collecting SSDI benefits.

If you are disabled and think you may be entitled to SSDI benefits, or need more information about disability-related matters, contact the Arizona disability attorneys of Roeschke Law, LLC at 800-975-1866 for a free consultation. We regularly represent clients from all Arizona counties and in all of Arizona’s local hearing offices, including Phoenix, north Phoenix, and Tucson.