While most government agencies and civilian companies offer some degree of employer-paid Disability Insurance, many of the programs may fall considerably short of the protection an individual may need, especially for any length of time.
Most working Americans would agree that protecting their income and their family’s livelihood should they fall sick or injured is on their priority list. The question becomes how do you weed through the choices and options for Disability Insurance and make the right choice for you? Only 40% of US households have enough in liquid savings to cover at least three months of their recurring expenses, and only 28% can cover at least six months.1
So, let’s look at the long-term disability landscape. While government employees have options to choose from for Health, Dental, and Vision care, a formal voluntary Disability program is not readily available. Under the federal government program, if you become disabled due to a sickness or injury, you basically have two options.
The first option is to use accrued sick leave or the leave bank, primarily used for a short term disabling condition. The second option is to apply for Disability Retirement under either the Federal Employee Retirement System (FERS) or Civil Services Retirement System (CSRS). These Disability programs are designed for sickness or injury expected to last over 12 months, but the programs may not provide the coverage you may need.
For instance, federally provided Disability Retirement benefits are taxable at the state and federal level. Other unfavorable federal program scenarios include: 1) not qualifying for Retirement Benefits as a new hire until you have been employed for 18 months and 2) having an injury or sickness that is expected to last less than 12 months. If you have a disabling accident or illness occur before you are eligible for the federal program or have a disability lasting less than 12 months, you may be forced into a “leave without pay” situation. You will be required to draw from your savings and other resources to pay for your bills during the time you are not earning an income. This can add additional stress at a time when you are focused on your disability.
Another Disability Insurance option for FERS employees is Social Security Disability Insurance (SSDI). Qualifying for SSDI can be much harder than you think and many that apply for Disability benefits through Social Security are denied the first time. One study shows the percentage of SSDI first time denial at 65%2. For those approved, the average benefit is $1,065 a month2, hardly enough to replace the average worker’s income.
That is why programs, such as GEBA’s Group Long Term Disability Insurance have been designed. GEBA sponsors a valuable disability program with members only rates. You can apply for monthly non-taxable benefit amounts up to $7,500 (not to exceed 67% of your gross monthly salary). The GEBA disability insurance coverage contains many features not often seen in other plans, such as Partial Disability and Rehabilitation Benefits, Survivor Income Benefits, and up to a 6% Cost of Living Adjustment (COLA)*. GEBA’s plan offers flexible waiting periods to meet everyone’s needs. GEBA also pays out benefits up to age 70*.
| GEBA Long Term Disability Insurance | FERS Retirement Disability | |
| % of Coverage | Up to $7,500 or 67% of your earned income | 60% of base income (1st year) 40% of base income (2nd year) |
| Waiting Period | Flexible 90 or 180 days | No waiting period if eligible |
| Taxable | No | Yes |
| Incapacity Definition | 2-year own occupation, any occupation thereafter | Own occupation |
| Eligibility | Immediate | • After 18 months for new federal employees• Disability must be expected to last for at least one year |
With all the concerns facing you and your family today, help take one worry off the table and contact GEBA at (800) 826-1126 to talk about Group Long Term Disability Insurance*.
*To learn more, please visit www.geba.com/disability for details including features, costs, eligibility, renewability, limitations, and exclusions. Group Long Term Disability Insurance is underwritten by New York Life Insurance Company, 51 Madison Avenue, New York, NY 10010. On Policy Form GMR.
1Council for Disability Awareness: https://disabilitycanhappen.org/disability-statistic/ September 30, 2021.
2Social Security Administration Disabled Worker Beneficiary Statistics, www.ssa.gov
