Is long-term disability insurance right for you?

Colorado offers residents short-term disability benefits at no cost. Those who find themselves disabled may be able to receive benefits for up to 180 days. However, the state doesn’t offer cost-free long-term disability insurance.

You’ll need to buy it

For those who remain disabled after their short-term disability benefits run out, a long-term disability insurance plan could save the day. Long-term disability insurance can replace 60% of your income. The set monthly maximum amount of money that you can receive is $10,000.

Long-term disability insurance is not offered free of charge like short-term disability benefits are. Rather, you’ll owe a yearly premium that is based on various factors such as your age and whether you have PERA benefits. When you receive long-term disability benefits, it’s important to note that they’ll be paid on an after-tax basis.

Investing in PERA

If you opt for investing in a PERA retirement plan, you can enjoy lower premiums for long-term disability insurance. Many citizens get confused when it comes to long-term disability insurance through the state and PERA. Both are disability insurance plans. However, they vary greatly in regards to their benefits and definitions of disability.

The Public Employees’ Retirement Association, or PERA, provides retirement and other benefits for employees who work for public entities and the Colorado government. Many who opt for investing in PERA include teachers, university professors, judges and local government employees. Those who invest in PERA do so as a substitute for Social Security.

When you live in the state of Colorado, you’ll be covered for short-term disability under the state at no cost. However, if you find yourself dealing with a long-term disability, you’ll need to have a long-term disability plan to fall back on. Getting a plan through the state can be a great way to ensure financial stability in the event that you become permanently disabled. If you have questions about filing a claim, you may want to consult an attorney.