Employer Disability Insurance

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Jeffrey Johnson is a legal writer with a focus on personal injury. He has worked on personal injury and sovereign immunity litigation in addition to experience in family, estate, and criminal law. He earned a J.D. from the University of Baltimore and has worked in legal offices and non-profits in Maryland, Texas, and North Carolina. He has also earned an MFA in screenwriting from Chapman Univer...

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UPDATED: Jul 16, 2021

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If you are one of the lucky employees whose employer has a group disability insurance policy, then you have some type of disability income insurance in place. However, you should consider supplementing an employee disability insurance plan with private coverage. There are several benefits of an individual plan that employee disability coverage does not offer, so make sure you assess your individual needs even if you have a group plan.

TIP: Do not assume that an employee disability insurance plan offers you complete protection should you be hurt and unable to work. Make sure your individual disability insurance needs are met by purchasing any additional coverage that you need.

Supplementing Employee Disability Insurance

If you select an employee disability insurance plan, you will need to consider supplementing it with private coverage. If the monthly income from employer disability insurance benefits is not close to your after-tax income and will not be sufficient to support your family, you can purchase additional individual disability income insurance to make up the difference.

If you can obtain group disability insurance coverage through your employer, you need to ask questions about the policy. Work through the following steps to find out the following:


  1. How long after the start of disability will benefits begin?
  2. How long will the disability income insurance payments continue?
  3. How injured do you have to be to qualify for disability benefits under the group plan?
  4. Find out whether your employer’s disability insurance plan takes other disability coverage/payments (such as social security insurance) into account when calculating benefit payments.
  5. Is your Employer Disability Insurance benefit subject to a maximum dollar amount?

The goal of reviewing your employer disability coverage is to understand whether or not the coverage adequately protects you. Compare the benefits of the plan to your current financial needs. If the plan comes up short, supplement it with private disability insurance.

TIP: As you do your calculations, consider whether the amount of employee disability insurance benefits you will be receiving will be reduced by the amount of any government benefits you might receive. Talk to your group disability insurance specialist to be sure.

Downside of Relying on Your Employer’s Disability Insurance

Although employer disability insurance is reasonably priced, there are some downsides. The primary cause of these downsides is the fact that you have very little control over the administration of the plan. Consider the following:

  • Employees can lose their jobs: Employer’s disability insurance is only offered if you are a current employee, and you can lose coverage if you quit or are terminated. Having your own disability income insurance policy already in place means you don’t have to worry about getting less coverage when you go through a career transition.
  • Employer group insurance can modify its coverage: Your employer can change the plan or cease offering disability insurance altogether, in which case you would be left with no disability insurance at all.
  • Employer group insurance may not be sufficient: An employee disability plan may not adequately cover all of your financial needs. Often times you do not have a choice about how much insurance coverage the group plan provides, and the benefit may come up short of what you need.

Having your own individual disability insurance policy would mean that no matter what happens-layoff, change of job, group disability insurance policy changes-you will always have your own disability income insurance protection. Choosing an individual disability insurance policy with lifetime benefits will mean that even if your employee disability insurance benefits are exhausted, you will be paid as long as you remain disabled. Get a free disability insurance quote today by clicking here and visiting the Free Advice quote center.

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