Can You Collect Long Term Disability and Social Security?

A disabling medical condition often brings financial concerns. Many wonder if they can receive support from both private long-term disability insurance and Social Security Disability benefits. Understanding these programs and their interaction is important. Both provide financial assistance during inability to work, but their eligibility, funding, and administration differ significantly.

Understanding Social Security Disability Benefits

Social Security Disability Insurance (SSDI) assists individuals unable to work due to a severe medical condition expected to last at least 12 months or result in death. SSDI is an earned benefit, with eligibility based on work history and payroll tax contributions.

To qualify for SSDI, individuals must accumulate a certain number of “work credits.” Credits are earned through covered employment, typically one credit for $1,810 in 2025, up to four per year. The total number of credits required depends on an applicant’s age at the onset of their disability. Most individuals aged 31 or older need 20 credits earned within the 10 years before disability.

The Social Security Administration (SSA) defines disability as an inability to engage in “substantial gainful activity” (SGA). This means a medical condition must prevent work earning above $1,620 monthly for non-blind individuals in 2025. The SSA assesses if the condition prevents past work or adjustment to other work, considering age, education, and prior experience. A five-month waiting period applies to SSDI benefits, with the first payment typically issued for the sixth full month from disability onset.

Supplemental Security Income (SSI) is a separate, needs-based program administered by the SSA. Unlike SSDI, SSI requires no work history and is funded by general tax revenues, assisting individuals with limited income and resources who are aged, blind, or disabled. While both programs use similar medical definitions of disability for adults, their financial eligibility criteria are distinct.

Understanding Long Term Disability Insurance

Long Term Disability (LTD) insurance replaces a portion of income if an individual becomes unable to work due to a qualifying injury or illness. This type of insurance can be obtained in two primary ways: through employer-sponsored group policies or by purchasing an individual policy directly from an insurer. Employer-sponsored plans typically pay a percentage of pre-disability income, often ranging from 50% to 80%, while individual policies might offer a fixed monthly benefit.

Eligibility for LTD benefits is determined by the specific policy terms, which include an “elimination period.” This waiting period, similar to a health insurance deductible, means no benefits are paid even after disability begins. Common elimination periods range from 90 to 180 days, though some policies may have periods as short as 30 days or as long as a year. This period typically starts from the date the disability began, not when the claim is filed.

LTD policies define “disability” differently from the SSA’s criteria. Many LTD policies initially define disability as the inability to perform the duties of one’s “own occupation” for a set period, such as the first 24 months. After this initial period, the definition often shifts to “any occupation,” meaning the inability to perform the duties of any occupation for which one is reasonably suited by education, training, or experience. This change in definition can impact continued eligibility for benefits.

LTD benefits replace 50% to 70% of pre-disability earnings, up to a maximum monthly amount specified in the policy. The duration of benefits can vary widely, with some policies providing coverage for a set number of years, while others may continue payments until retirement age or recovery.

Coordination of Social Security and Long Term Disability Benefits

Individuals can receive both Social Security Disability Insurance (SSDI) and Long Term Disability (LTD) benefits concurrently. This dual benefit receipt provides a more stable financial foundation for individuals unable to work. However, their interaction is not always straightforward due to common policy provisions.

Most LTD policies include an “offset” or “coordination of benefits” clause. This provision allows the LTD insurer to reduce its benefit payout by the amount of other income received, including SSDI benefits. This offset prevents combined disability income from exceeding pre-disability earnings and encourages SSDI applications, reducing the insurer’s obligation.

In practice, if an individual receives $2,000 per month in LTD benefits and is approved for $1,000 per month from SSDI, the LTD insurer will typically reduce its payment to $1,000. The claimant would then receive $1,000 from SSDI and $1,000 from their LTD policy, maintaining a total of $2,000 in combined benefits. The total combined benefit amount usually remains capped at the percentage of pre-disability income originally covered by the LTD policy, often around 60% to 80%.

Many LTD policies require claimants to apply for SSDI benefits as a condition of continued LTD payments. Insurers often have a vested interest in this, as a successful SSDI application reduces their financial exposure. Some LTD insurers may even provide assistance, such as legal or administrative support, to facilitate the SSDI application process.

If SSDI benefits are approved retroactively with a lump-sum payment, the LTD insurer typically seeks reimbursement for overlapping payments. Claimants may need to repay the LTD insurer the SSDI back pay corresponding to the period they received LTD benefits. While SSDI benefits may include cost-of-living adjustments (COLAs), these increases typically do not trigger further LTD benefit reductions, allowing overall disability income to potentially increase.

Applying for Social Security Disability and Long Term Disability

Applying for Social Security Disability Insurance (SSDI) and Long Term Disability (LTD) involves distinct procedures. SSDI claims are initiated by submitting an application online, by phone, or in person at a Social Security office. Applicants must provide medical records from treating physicians, hospitalizations, and diagnostic tests. Work history, education, and financial circumstances are also typically required.

The SSA’s review process for SSDI claims can be lengthy, often taking months to over a year for an initial decision. During this time, the SSA may request additional medical evidence or schedule consultative examinations to assess disability severity. A thorough, well-supported application with consistent medical evidence can help facilitate review.

For LTD benefits, the application process begins by notifying the employer or insurance carrier directly. This involves submitting initial claim forms provided by the insurer. Claimants provide attending physician statements, employer statements detailing job duties and earnings, and medical records. The LTD insurer will review these documents to determine if the claimant meets the policy’s definition of disability and other eligibility criteria.

While SSDI and LTD application processes are separate, cooperation among the claimant, medical providers, and the LTD insurer is often beneficial. Many LTD policies require claimants to apply for SSDI benefits, and close coordination ensures necessary information is shared efficiently. This integrated approach can streamline both claims, as the LTD insurer may require updates on SSDI application status and outcome.