CA Insurance #0E86560
550 S. Hope street suite #2170
Los Angeles, CA 90071
(213)622-6202
DISABILITY
California State Disability
The plan provides tax-free replacement of income of 55% of an employee's average weekly pay, up to a maximum weekly benefit, which was $959.00 ($50/week minimum) in 2009. For 2010 and 2011, the maximum weekly benefit increases to $987.00. Benefits become available on the eighth consecutive day of disability and continue for up to 52 weeks of disability if the beneficiary paid SDI taxes as an employee, 39 weeks if the beneficiary had voluntary self-employment coverage. SDI is deductible as tax on federal returns because it is a collected tax. Sometimes this amount of benefit is still not enough for some middle to high income earners. That is why there are options for employees with no employer sponsored disability or self employed individuals.
Individual disability insurance
Those whose employers do not provide benefits, and self-employed individuals who desire disability coverage, may purchase their own policies on the open market. Premiums and available benefits for individual coverage vary considerably between different companies, for individuals in different occupations, and by state and country. In general, premiums are higher for policies that provide more monthly benefits, pay the benefits for a longer period of time, and start payments for benefits more quickly following a disability. Premiums also tend to be higher for policies that define disability in broader terms, meaning the policy would pay benefits in a wider variety of circumstances. There are many web-based disability insurance calculators to determine the disability insurance needed.[3]
High-limit disability insurance
Traditional disability carriers have limitations on the monthly benefits that can be purchased, which limit the benefits for high income earners. Benefits will normally cap at $20,000-$25,000 of monthly benefits except in the high-limit disability market. High-limit disability insurance is designed to keep individual disability benefits at 65% of income regardless of the income level. Coverage is typically issued on top of coverage that is already in force. With high-limit disability insurance, benefits can be anywhere from an additional $2,000 to $100,000 per month. Issue (one policy) and participation (other individual disability insurance or group long-term disability) coverage has gone up to $30,000 with some companies.
