Disability Benefits of Social Insurance. Are You eligible?

I have spoken well about the importance of having disability insurance in the past, many questions still arise about disability benefits from Social Insurance. Everyone seems to have a history, or they know someone who is receiving a disability from Social Insurance, so there is always some skepticism about whether or not external coverage is needed.

Think of it this way: if it is easy to qualify for Social Insurance disability benefits, why is there an army of lawyers and law firms that specialize in Social Insurance disability claims and appeals?

Go ahead and do a quick search on the web for these lawyers. You’ll be surprised what you find, and how many of those sites look as good as those corny local commercial ambulance chaser you see on your local television station. Leaving aside all the cynicism, this is a real benefit that is paid with tax dollars, so let’s take a look at this benefit in a few words.

To qualify for a disability benefit, a worker must:

Be completely insured at the beginning of the disability.
Has worked in jobs covered by Social Insurance for at least five of the last ten years (20 of 40 quarters). This applies to the disability that begins after age 31. If the disability begins before age 31, you must have worked in a job covered by Social Insurance for most of the six quarters, or at least half of the quarters between the 21st and the age when the disability began
Be under the normal retirement age of Social Insurance. After the normal retirement age, disability benefits turn into retirement benefits.
Having a physical or mental impairment that (1) incapacitates the worker from performing any substantial work, and (2) is expected to be terminal or last at least 12 months.

A disabled worker who qualifies for Social Insurance disability benefits is entitled to the full benefit payable until the earliest of the following:

The disability ends: the benefits end in the second month after the end of the disability.
The worker dies: the benefits are canceled in the month before the worker’s death (for example, the worker dies in July and the June benefit is not paid).
The worker reaches the normal retirement age.
Benefit of the spouse. Disability benefits for spouses are calculated in the same way as conjugal retirement benefits: 50% of the worker’s benefit, reduced if the spouse is below the normal retirement age. The benefits are subject to a family maximum.

Benefit of the child. A child under the age of 18 or under 19 if still in high school is eligible for a benefit that amounts to 50% of the disabled worker’s benefit, again subject to the family maximum.

But how much money would you receive even if you qualify?

Well, the Social Insurance Administration has some good calculators that can help you see how unfortunate the benefit would be if you really could not work. I went ahead and made the first option to use the quick calculator just to see what my benefits would be, and it was not pretty. My disability benefit would be around 38% of my current salary.

And this number is high, because my salary has only been at this relative level for a few years. Before that, it was significantly smaller. Then, using the detailed estimator, I discovered that my benefit would be approximately 23% of my salary.

Go ahead, enter your numbers and see what it is about. I do not know about you, but even in the rare case that I could qualify for this disability benefit, my life would certainly not be the same when trying to live on a fraction of my salary.

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