Temporary Disability Benefits
Temporary disability benefits provide a partial monthly income for people with a temporary injury or sickness that prevents them from working. You can apply for benefits by submitting a claim to your insurance provider. Learn what temporary disability benefits are, how much they pay and how you can apply for them.
- Written by Lindsey Crossmier
Lindsey Crossmier is an accomplished writer with experience working for The Florida Review and Bookstar PR. As a financial writer, she covers Medicare, life insurance and dental insurance topics for RetireGuide. Research-based data drives her work.Read More
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- Reviewed ByBrandon Renfro, Ph.D., CFP®, RICP®, EA
Brandon Renfro, Ph.D., CFP®, RICP®, EA
Retirement and Social Security Expert
Brandon Renfro is a Retirement and Social Security Expert and financial planner. He focuses on helping clients create a secure financial future in retirement and co-owns Belonging Wealth Management. He is also a former finance professor and writes for several publications.Read More
- Published: March 6, 2023
- Updated: June 23, 2023
- 4 min read time
- This page features 6 Cited Research Articles
- Edited By
- Temporary disability benefits replace some of your income when you can’t work due to a sickness or an injury.
- Benefit amounts from temporary disability plans are capped at two-thirds of the statewide average weekly wage.
- Most private plans have higher payment ceilings than state plans.
- You likely won’t be eligible for benefits if you caused your own injury or illness or if you become disabled due to a pre-existing condition.
How Do Temporary Disability Benefits Work?
Temporary disability benefits are granted to those who are unable to earn their normal wages due to a work-related injury. The amount you receive is based on your recent work history. It usually amounts to two-thirds of the monthly earnings you were getting at the onset of your disability.
These benefits are a short-term alternative to programs like Social Security Disability Insurance (SSDI) and Supplemental Security Income (SSI). But many people who eventually receive SSDI and SSI payments also secure temporary disability benefits before being approved for long-term benefits.
Employers in five states must provide employees with temporary disability insurance: New Jersey, New York, Rhode Island, California and Hawaii. The same holds true in Puerto Rico. The five states have plans that employers can sign up for, as well as private short-term disability insurance plans.
Many employers in other states also offer temporary disability coverage under private plans as part of their employee benefits package. If you’re self-employed or don’t get coverage through your job, you can also purchase a private temporary disability insurance policy on your own.
What Is the Statewide Average Weekly Wage (SAWW) for Temporary Disability?
The Statewide Average Weekly Wage (SAWW) measures how much an average person makes per week in each state. It’s calculated by taking the statewide average annual wage and dividing it by 52. For example, California’s SAWW is $1,651 in 2023.
SAWW figures determine the minimum and maximum amount of temporary disability benefits you can receive through state plans. Weekly benefits can’t exceed two-thirds of your state’s SAWW, even if you made significantly more than that amount prior to your injury. Conversely, your benefits can’t fall below one-third of your state’s SAWW, even if you made less than that amount before.
Some private temporary disability insurance plans also use SAWW calculations to inform their minimum and maximum benefit amounts. However, many plans provide coverage with higher maximum amounts. This can make private plans the best choice for high-wage earners who want to protect their lifestyle.
Social Security provides disability benefits, but only when the disability is expected to be long-term. You need to have a plan for a short-term disability as well, whether that is insurance coverage or a sufficient emergency fund.
How To Apply for Temporary Disability
To apply for temporary disability benefits, file a claim with your insurance provider. Get a claim form online and fill it out with the help of your doctor’s office or another qualified health care professional.
Detail your work history, income and information about your disability on the claim form. You also will need to say how your disability limits your ability to work and how long doctors believe it will last.
Limitations and Exclusions
Each temporary disability insurance plan has a particular set of limitations and exclusions. But regardless of your plan, you can only receive benefits for a few months at a time. If you still can’t work by the time your coverage runs out, you’ll need to apply for long-term disability benefits through your insurance or through the federal Social Security Disability Insurance program.
- Self-inflicted injuries
- Injuries and illnesses received while committing a crime
- Impairments from a pre-existing condition
Check the fine print of your temporary disability insurance plan to find out if you qualify for benefits and how long you can receive them.
Who Approves You?
If you’re applying to a state plan, a claims examiner from your state’s administration board will decide whether to approve or deny your benefits. Sometimes, you may have to undergo a physical examination with a state-appointed physician as part of the application process. In these cases, this physician will also have a say in the approval process.
If you’re applying for a private plan, then a claims examiner from the provider will decide your benefits eligibility.
6 Cited Research Articles
- State of California Department of Industrial Relations. (2023, January). Worker’s Compensation Benefits. Retrieved from https://www.dir.ca.gov/dwc/WorkersCompensationBenefits.htm
- Pennsylvania Department of Labor and Industry. (2023). 2023 Statewide Average Weekly Wage Announced. Retrieved from https://www.dli.pa.gov/Businesses/Compensation/WC/claims/Pages/Statewide-Average-Weekly-Wage-(SAWW).aspx
- Congressional Research Service. (2021, October 28). Access to Short-Term Disability Plans: In Brief. Retrieved from https://crsreports.congress.gov/product/pdf/R/R46948/2
- New Jersey Division of Temporary Insurance. (2018, January). Temporary Disability Insurance Program. Retrieved from https://www.state.nj.us/labor/forms_pdfs/tdi/WPR-117%20(1-18).pdf
- United States Department of Labor: Employment & Training Administration. (n.d.). Chapter 8: Temporary Disability Insurance. Retrieved from https://oui.doleta.gov/unemploy/pdf/uilawcompar/2020/disability.pdf
- The Maine Bureau of Insurance. (n.d.). Maine Bureau of Insurance: Guide to Disability Insurance. Retrieved from https://www.maine.gov/pfr/insurance/sites/maine.gov.pfr.insurance/files/inline-files/consumers_guide_to_disability_insurance.pdf