How Long-Term Disability Benefits Differ from Social Security Disability Benefits

When an illness or injury prevents you from working, disability benefits can provide a critical financial lifeline. However, understanding the difference between long-term disability (LTD) insurance and Social Security Disability Insurance (SSDI) is essential to maximizing your coverage and planning your next steps. Both programs offer income replacement, but they operate under very different rules, processes, and qualifications. A skilled Philadelphia long-term disability insurance lawyer from Edelstein Martin & Nelson can help clarify these differences and guide you through each system.

Understanding Long-Term Disability Insurance

Long-term disability insurance is typically a private policy purchased either individually or through an employer-sponsored benefits plan. LTD is designed to replace a portion of your income, usually around 50% to 70% when you’re unable to work for an extended period due to a medical condition or injury.

These policies vary widely depending on the insurer and the specific terms. In general:

• LTD benefits are paid monthly, often after a waiting period of 90 to 180 days.
• Benefits can last for a set number of years or until retirement age, depending on the policy.
• The definition of “disability” may change over time (e.g., from “own occupation” to “any occupation”).

Because LTD policies are contractual, every word in the policy matters. Claimants must meet strict deadlines and document their medical limitations carefully.

Understanding Social Security Disability Insurance

Social Security Disability Insurance is a federal program managed by the Social Security Administration. Unlike LTD benefits, SSDI is not based on a private contract but on your work history and the taxes you’ve paid into the system. To qualify, you must have a sufficient number of work credits and meet the SSA’s strict definition of disability.

SSDI only pays benefits if your condition is expected to last at least one year or result in death and if you are unable to perform any substantial gainful activity. Approval can take months, often involving appeals and hearings.

Key features of SSDI:

• Monthly payments are based on your average lifetime earnings.
• Medicare eligibility begins two years after SSDI benefits start.
• There are no partial disability benefits; it’s all or nothing.

Major Differences to Know

Although both systems offer disability income, their goals and requirements are quite different. Understanding these differences can help you avoid delays and denials.

Some key distinctions include:

• Eligibility: LTD is based on your insurance policy; SSDI is based on your work history and SSA rules.
• Definition of disability: LTD may allow you to collect if you can’t do your specific job; SSDI requires that you can’t do any job.
• Time to benefits: LTD typically starts after a short waiting period; SSDI often takes longer due to processing and appeals.

Can You Get Both?

Yes. It is possible to receive LTD benefits and SSDI at the same time. In fact, many LTD policies require you to apply for SSDI. However, your LTD benefits may be reduced by the amount you receive from Social Security. This is known as an “offset.”

Talk to a Philadelphia Long-Term Disability Insurance Lawyer Today

Navigating both systems at once can be overwhelming. Insurance companies may deny valid claims, and the SSA’s strict standards can result in rejections that require multiple appeals. That’s why working with a knowledgeable Philadelphia long-term disability insurance lawyer is crucial. 

At Edelstein Martin & Nelson, our team understands the complexities of both LTD and SSDI claims. Call (215) 731-9900 today for experienced legal guidance tailored to your situation.