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How Does Long Term Disability Work with Social Security Disability?

by Ryan Kinnar5 min read
Long Term Disability Work with Social Security Disability

If you have a disability that is long term or permanent and renders you incapable of gainful employment, then there are different types of programs available to help you. You just need to understand the differences between these programs.

 How Does Long Term Disability Work with Social Security Disability?

What are Long-Term Benefits?

Long-Term Benefits are insurance plans that are available through your employer or through a private company.


Differences between Social Security Disability Insurance and Long-Term Disability Insurance

Social Security Disability Insurance is very different from Long-Term Disability Insurance. Here are a few of the differences between the two types of insurances:

  • Social Security Disability is a government run insurance program funded by FICA taxes while Long-Term Disability insurance programs are usually private insurances funded by premiums paid by their customers.
  • It is easier to get approval for Long-Term Disability Insurance than it is to get Social Security Disability approval. First time applicants have a 30% chance of having their Social Security Disability claim approved.
  • The Claims process to get Social Security Disability is a long one. The average Social Security Disability Insurance claim takes about 5 months to be approved. Long-Term Disability doesn’t take that long.
  • You also are not eligible for SSDI for the first 6 months of your disability.


So, how does Long Term Disability work with Social Security Disability?

Here are a few points to clear out with regard to how Long-Term Disability Insurance works with Social Security Disability:


Will my Eligibility for Social Security be impacted by Long-Term Disability Insurance?

Your eligibility for Social Security Disability would not be impacted by your having Long-Term Disability Insurance. SSD approval is dependent on whether you are carry out Substantial Gainful Activitiesor SGAs. This basically means whether you are doing work that requires physical and/or mental effort. LTD does not qualify as SGA and so does not impact the decision making process for SSD.


Can I have both SSD and LTD benefits at the same time?

Yes, you can have both SSD as well as Long-Term Disability benefits at the same time. However, do make sure you read the terms and conditions to understand clearly what you will be getting.


Does my LTD benefit get impacted once I start receiving SSD benefits?

Yes. The catch to all this is that if you receive Long-Term Disability, then it may be impacted when you start to receive your Social Security Disability checks. For example, if you were getting $1000 from SSD and another $2000 from LTD, then the Long-Term Disability payout may be reduced to $1000 to compensate for the extra income.


Are there any other payments I will have to make once my SSD kicks in?

Yes. LTD also may end up taking a portion of your back pay to compensate for the extra monies they were giving you while you were waiting for your Social Security to kick in. Please ensure that you read the terms and conditions in your Long-Term Disability insurance plan to see if they will take your back pay in case your Social Security Disability benefits are approved.


If I am approved for SSD benefits, then do I also get approved for LTD benefits?

No. LTD programs are run by private insurance companies and each company will have their own criteria for eligibility. You would need to check with your private insurer to find out the approval process for your Long-Term Disability insurance package.

Similarly, if you are approved for LTD, it doesn’t mean that you will be approved for SSD.