Preparing for the birth of a child and maternity leave brings many challenges. Paying for the birth especially when a Mother takes a break from work can complicate household finances. Short term disability insurance can be a way to offset the sudden change in income. Can you use short term disability for maternity leave? It depends. Keep reading for more on this often-overlooked benefit.
What is Short-Term Disability Insurance?
Short-term disability insurance is designed to pay your family a percentage of your salary in the event you can’t work due to injury, sickness, or some other medical reasons. The eligible reasons are specified by the insurance provider. Many mothers are eligible for a plan at work. Signing up for short term disability is just like any other benefit you elect during open enrollment. Does short term disability cover maternity leave? Let’s find out with some helpful tips.
“Before I formed you in the womb I knew you, and before you were born I consecrated you; I appointed you a prophet to the nations.” Jeremiah 1:5 ESV
Can you use short term disability for maternity leave? 7 Tips
1: Pregnancy Can (Sometimes) Qualify for Short Term Disability
Don’t get fooled by terminology. Short-term disability is not just for injuries. Many policies cover situations like the birth of a child. This can be a way to still receive some level of income for mothers who were working prior to birth and postpartum.
2: If you buy a policy outside of work, read the fine print
If you and your spouse decide to buy a short term disability plan and it’s not through an employer, be sure to check what is and is not covered. Some plans do not cover normal childbirth or pregnancy. A plan might only offer income replacement in the event of complications. There may still be other reasons to buy a plan on your own, but if covering childbirth is a primary goal, you’ll want check carefully on coverage details.
3: Your Short-Term Disability Payments are Based on a Percentage
Short-term disability plans will generally replace a percentage of income while in effect. This is generally between 50-100% of your usual income. If you are on a variable, performance-based, or commission driven compensation plan for your job, then you’ll need to check on your specific plan to see how the benefit amount is determined.
4: How Long ST Disability Lasts Can Vary by Your Birth Experience
Some short-term disability plans cover a different percentage of pay and length of time according to what kind of birth your family experiences. For examples, some plans offer a longer benefit period if your experience complications. A Caesarean section will sometimes fall in a longer benefit period due to the extended recovery time.
5: Where you live can make a difference on coverage
Some states have specific rules on how maternity leave and short-term disability work. Even for the same company, employees in one of these states can have a separate set of rules from employees in other locations. If there is a difference, then this should be clearly spelled out in an employer provided ST disability plan.
6: ST Disability Can Have a Delay
Many short-term disability plans do not begin replacing the income for a mother right away. Some plans have what’s called an “elimination period.” This is how long a mother needs to be away from work before their disability benefit begins. There could be no waiting period all, but 1-2 weeks is common. When the clock starts can also vary according to your plan and situation. For example, if Mom to be is put on bedrest, then the clock may start before the child is born.
7: Short Term Disability Can (Sometimes) Be Used in Conjunction with Other Benefits
Some companies offer other benefits that can be used alongside ST disability. For example, ST disability could provide some income replacement and the company could also offer maternity pay. It’s important to check with an HR or benefits representative to ensure your family maximizes and coordinates available benefits.
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