Short-Term Disability Income Insurance

Top 6 Reasons to Consider Disability Income Insurance…You May Not Be Covered With The FERS Total Disability Program

1) To Be Eligible for FERS Total Disability Benefits, Your Disability Must be Expected to Last at Least One Year.

How would you pay for living expenses if you could not work for several months, but your disabling illness or injury is expected to last less than 12 months? After either a 14 or 30 day waiting period, you could receive replacement income from the NRLCA Disability Income Gap Program.1

2) Are You Eligible for the FERS Total Disability Plan?

New Federal Employees must wait until after 18 months of service to qualify for FERS disability income protection.2

3) Gaps in the FERS Total Disability Plan

There are significant gaps in the federally provided disability income (FERS) protection plan.

(1) FERS does not provide a disability income benefit unless the disability is expected to last at least 12 months.2

(2) After being approved for FERS Total Disability, the member would receive a benefit of 60% of pre-disability income for twelve (12) months, only if they were totally disabled.2

(3) At the start of the thirteenth  month (13), the FERS disability income will reduce payments to provide only a 40% income replacement.3

4) Partial Disabilities are Not Covered

FERS disability income coverage does not include partial disability benefits. In a recent study of federal employee claims, over 72% of disabilities were partial or residual disabilities lasting less than a year.² In each of these cases the member would not qualify for FERS disability income protection.4

5) FERS Disability Payments are Taxable

Any federal disability retirement income benefit is taxable. The disability income benefits provided by the NRLCA Disability Income Gap Program are not taxable* to a member, which means a greater amount of income replacement for members when they need it most.5

*IRS Publication 907

6) Approval Process Takes a Long Time

Approval process for FERS and Social Security disability can take a long time. Under FERS and Social Security, a federal employee may have to wait up to a year for an approval of their claim. NRLCA Disability Income Gap Program averages 30 days or less to make a final decision on all claims.6

Social Security Disability Income Charts

How long can you go without an income?

A serious medical condition or accidental injury can deplete your savings in a relatively short period of time. By planning ahead and getting the right coverage, you will be able to cover:

• Mortgage or rent
• Credit cards and other debts
• Food
• Health, life and auto insurance premiums
• Utilities
• Car payments
• Clothing
• Other transportation expenses

Benefit Summary


Benefit Period: 6 months
Waiting Period: 14 days after a illness or injury
Monthly Benefit: 60% up to $3,000 per month


Benefit Period: 6 months
Waiting Period: 30 days after a illness or injury
Monthly Benefit: 60% up to $3,000 per month


Benefit Period: 1 year

Waiting Period: 14 days after a illness or injury
Monthly Benefit: 60% up to $3,000 per month

Benefit Period: 2 year
Waiting Period: 30 days after a illness or injury
Monthly Benefit: 60% up to $3,000 per month

OPTION 5 (Designed for offsetting 6 month waiting period for members that are insured by the long term disability insurance plan.

Benefit Period: 3 months
Waiting Period: 90 days after a illness or injury
Monthly Benefit: 60% up to $3,000 per month

A member is eligible to receive benefits:

• When totally disabled
• Under a physician’s care
• The accident or sickness is non-work related
• The selected elimination period has been satisfied

Pre-Existing Condition Limitation

No benefit for a pre-existing condition until the insured has been continuously insured under the policy for 12 consecutive months

Must be performing the duties of his or her occupation for 30 continuous days after the first 12 months of insurance

Base Policy

Waiver of Premium –

An insured member does not pay premiums after 90 consecutive days of total disability or the satisfaction of the elimination period, whichever is later.

Partial Disability Benefit –

A partial disability will be paid if an insured becomes partially disabled due to the same cause as total disability. The benefit is 50% of the initial benefit.

Accelerated Benefit for Terminal Illness –

If a member is diagnosed with a terminal illness for the first time, on or after the effective date of insurance, the plan will accelerate the monthly disability benefit for the remaining months of payments of the maximum disability period of the contract selected. Rider Form Series (CRDITI00)

Mental Illness Limited Benefit –

Totally Disabled due to a Mental Illness, regardless of the cause, Disability Benefits will be paid for the period. Mental Illness means Disability due to or resulting from psychiatric or psychological conditions, regardless of cause. The term Mental Illness does not apply to dementia, if due to Stroke, Trauma, Viral Infection, Alzheimer’s disease, or other conditions not usually treated by a mental health provider using psychotherapy, psychotropic drugs, or other similar modalities

When Do Benefits Begin?

After completing the waiting period for the benefit period selected for either illness or injury, the plan will pay the selected benefit amount for the benefit period selected or the end of the disability which ever is sooner.

1. Office of Personnel Management
2. Council for Disability Awareness, 2013 Long-Term Disability Claims Review. Retrieved Nov. 15, 2013, from Council for Disability AwarenessWeb site: http://
3. Social Security Administration
4. Internal Revenue Service Publication 907, Tax Highlights for Persons with Disabilities, retrieved April 24, 2015 from 5. You must have completed at least 18 months of Federal civilian service which is creditable under FERS.
6. National Payroll Week, 2013 “Getting Paid in America” Survey Results. Retrieved Nov. 15, 2013 from National Payroll Week 2013


Limitations and Exclusions

The sum of the disability benefits paid to the insured together with the payments the insured is entitled to receive from the

sources described below, may not exceed the monthly percent shown on the Product Details page:

a.  Group insurance or like insurance for persons in a group;

b.  Federal Social Security Act (this includes benefits paid to the insured employee and his or her dependents on account of the insured’s disability);

c.  State or federal government disability or retirement plan, or increases thereof, which begin on or after the date of total disability;

d.  Pension plan to which the policyholder or the insured’s employer contributes or makes payroll deductions;

e.  Salary or wage continuance plans such as sick leave paid for by the policyholder or the insured’s employer which extend beyond the period stated in the contract; and

f.  Federal Old Age Benefits or increases which begin on or after the date of total disability, under the Federal Social Security Act on the insured employee’s behalf.

With respect to items (b) and (f) only, unless we receive proof that payments under these applicable programs or acts have been applied for but will not be paid, we:

a.  will assume such payments are being received if the insured is covered under the Federal Social Security Act; and

b.  may require re-application (but not more frequently than annually) once a Social Security denial has been received and all appeals have been pursued. Failure to re-apply for benefits when required by us will result in our estimation of payment under those acts.

Benefits will not be reduced due to a cost of living increase in Social Security if the increase takes place while benefits are payable under the policy.

With respect to any and all of the above sources, if the insured or his or her dependent receives a lump sum payment for a period previously paid by us, any resulting overpayment must be repaid on a lump sum basis. If the insured has the option of taking retirement benefits on a monthly basis but chooses to receive retirement benefits in a lump sum, we may assume he or she is receiving retirement benefits based upon the lowest monthly retirement plan benefit available to the insured prior to lump sum withdrawal.

If the insured is totally disabled and receiving regular treatment due to a covered mental illness, regardless of the cause, monthly disability benefits will be paid for one-half (1/2) of the benefit period for any one period of disability. The lifetime maximum is 12 months of disability payments.


The policy does not pay benefits for any loss, fatal or non-fatal, which results from: intentionally self-inflicted injury while sane or insane; any act of war, declared or undeclared; accident sustained or sickness contracted while in the service of the armed forces of any country; committing a felony; operating, learning to operate or having any duty in the operation of any device or vehicle intended or designed for flight in the air including boarding, alighting or descending therefrom; accident or sickness arising out of and in the course of the insured’s occupation for wage or profit. This exclusion applies even if Workers’ Compensation is not paid for the on-the-job injury.

Pre-Existing Condition

There will be no disability benefit payable for a pre-existing condition until the insured has been continuously insured under the Policy for 12 consecutive months and has returned to performing the duties of his or her occupation for 30 continuous days after the first 12 months of insurance.

“Pre-Existing Condition” means sickness or physical condition for which the insured had treatment, incurred expense, took medication, or received a diagnosis or advice from a physician, during the 12-month period immediately before the effective date of insurance.

The term “Pre-Existing Condition” will also include a condition that manifests itself in a way that would cause an ordinarily prudent person to seek medical advice, diagnosis, care or treatment.

Termination of Insurance

Member insurance will terminate on the earliest of:

the date the insured does not qualify as an insured;

the date the insured retires;

the date the insured ceases to be on active service;

the end of the last period for which premium has been paid, subject to the Grace Period;

the date the group master policy is discontinued.

Termination will have no effect on payment of benefits for a total disability that begins before such termination. We will have the right to terminate the insurance of any insured person who submits a fraudulent claim under the policy.

Termination of the Group Master Policy

The policyholder may end the policy on any premium due date by submitting a 60-day advance written notice. A group will not be continued if it drops below the minimum required participation. The group master policy will be terminated and insurance of all remaining insureds will end, subject to any portability option.

Other Insurance with Us

An individual can only have one disability income policy or certificate with us. If a person already has disability income insurance with us, such person is not eligible to apply for this insurance.