How long do short-term disability benefits typically last?

On Behalf of | Nov 17, 2023 | ERISA Disability Benefits

Many people cannot afford private short-term disability insurance on their own. Such policies are often very expensive. They may rely on coverage provided as part of a comprehensive benefit package from an employer instead.

The Employee Retirement Income Security Act of 1974 (ERISA) applies to not just pensions and retirement funds but also insurance coverage provided as an employment benefit. It is often more cost-effective for companies to purchase multiple short-term disability policies for employees than it would be for workers to buy the same coverage on their own.

Private short-term disability insurance helps to more fully replace wages than workers’ compensation coverage would. Someone hurt on the job can rely on short-term disability benefits to help replace their wages until they can get back to work. How long do short-term disability benefits typically last?

Each policy has unique rules

There is no specific rule under ERISA for the duration of short-term disability benefits. Insurance companies and employers offering benefits often negotiate unique terms for each new job-related policy issued. The standard duration for short-term disability coverage is usually three months, six months or one year. Typically, workers must be away from their employment for a specific number of days before they become eligible for benefits. They can then receive short-term disability coverage until they return to work or reach a point where they qualify for long-term disability benefits instead.

How does ERISA protect claimants?

Someone with an employment-related short-term disability insurance policy has certain rights under ERISA. Those rights include receiving coverage as outlined in their policy and the right to an appeal after an unfair denial of benefits. The plan administrator reviewing claims also has a fiduciary duty to act in the best interests of policyholders, not the insurance company.

Workers who believe that an insurance company has not upheld a policy often need to review the policy documents to check the specific terms set for their coverage. A thorough review of the policy paperwork can help someone establish whether the company violated the policy and what steps to take next.