Disability Insurance (Employer)
Employer-provided income replacement if you become unable to work due to illness or injury. Short-term disability (STD) covers weeks to months; long-term disability (LTD) covers years or until retirement age. Often an overlooked but high-value benefit.
Disability insurance replaces a portion of your income if you become unable to work due to a non-work-related illness or injury. It's one of the most underappreciated but genuinely valuable employee benefits. **Short-Term Disability (STD):** - Typically covers 60-70% of salary - Benefit period: Usually 8-26 weeks - Waiting period: Typically 7-14 days before benefits kick in (use sick days/PTO during this period) - Common situations: Maternity leave, surgery recovery, serious illness **Long-Term Disability (LTD):** - Typically covers 50-70% of salary - Begins after STD period ends - Benefit period: Years, or until Social Security retirement age - Definition of 'disabled': Check whether the policy covers 'own occupation' (unable to do your specific job) or 'any occupation' (unable to do any job) — own occupation coverage is more generous **Why it matters:** Statistics show approximately 1 in 4 workers will have a disability that prevents work at some point in their career. Despite this, disability insurance is often the least-reviewed benefits component. The difference between having and not having it during a serious illness is profound. **Portability:** Employer-provided disability insurance is not portable. Individual disability policies can be purchased to supplement employer coverage, particularly important for high earners whose coverage cap (usually $15,000-$20,000/month) leaves significant income exposed.
Why it matters
For most working adults, disability is a more likely income risk than death in the working years. Employer disability insurance is one of the highest-real-value benefits, but almost no one evaluates it when comparing offers.
Candidate tip
Ask about both short-term and long-term disability coverage in your offer package — and specifically whether LTD is 'own occupation' or 'any occupation,' as this distinction dramatically affects what qualifies as a covered disability.
Related terms
Life Insurance (Employer)
Offers & NegotiationEmployer-provided coverage that pays a death benefit to your designated beneficiaries. Most employers provide basic life insurance (1-2x salary) at no cost. Supplemental coverage can be purchased. A standard benefit that varies little across employers.
Benefits Package
Offers & NegotiationThe non-salary compensation provided by an employer — health insurance, retirement plan, PTO, parental leave, and more. Benefits can represent 20-30% of total compensation value and vary significantly between employers.
Health Insurance (Employer)
Offers & NegotiationMedical insurance provided through an employer's group plan. Employers typically pay 60-85% of the premium; employees pay the remainder. The employer's contribution level is a significant variable in total compensation that's often overlooked.
Severance Package
Offers & NegotiationCompensation and benefits provided by an employer when terminating an employee — typically a payment based on tenure, plus benefits continuation. Severance is not legally required under US federal law but is common at professional employers.