As a Federal Employee You need to understand the benefits that the FERS Disability Program offers you. An understanding will help you effectively assess your income protection. And make an informed decision about whether you should get individual disability insurance to supplement what you already have.
without going into too much detail. Federal employees are eligible for disability insurance through the FERS program once they have been employed for 18 full months. for any injury or illness that prevents you from performing your current job and will likely take more than a year. You are eligible for 60% of your annual salary during the first 12 months of the disability claim and 40% of your annual salary. after that every year
What you may not know is Even if you have insurance for 60% and 40% disability coverage, you may be able to receive fewer benefits than you expected when you claim. This is because the federal government primarily pays disability support services Melbourne. What you earn at the time of your claim is taxed as ordinary income. In addition to the reduction in coverage from 60% to 40%, federal employees face significant income protection shortfalls, allowing federal employees to receive individual disability insurance to supplement their coverage.
The same applies to individuals in the private sector who take out individual disability insurance as a supplement to the collective disability insurance. Federal employees can also purchase individual disability insurance to supplement their FERS disability benefits. Some options are more interesting than others.
When considering purchasing individual disability insurance Look for two main features in your policy. The first is to make sure you don’t limit the terms of the policy and the drivers that can be added to your policy. If you are going to spend money on personal protection to protect your income properly and effectively. Make sure you’re not limited by what you can add to your policy. Second, make sure your personal policy benefits aren’t offset by Social Security disability benefits. Your FERS disability benefit has already been adjusted for a WAO benefit. It’s bad enough that most of your FERS benefits can be offset with Social Security benefits, but again, if you spend the money properly to protect your income, you’ll be fine. You need to make sure you don’t pay disability insurance that reduces your FERS benefit anyway.
Taking out individual disability insurance to fill gaps in your FERS disability coverage is a responsible and smart way to effectively protect your income, family and future. Be sure to work with someone who is familiar with the details of FERS disability benefits, including the individual options available to federal employees.
