By
Michael Relvas
Similar to most employers in America, the Federal Government does not exactly make information readily available for employees to find and review relating to group benefits and more specifically, Disability insurance. Disability insurance is arguably one of the most important types of coverage a person can have, and therefore is worth researching and understanding. Nearly all Federal Government employees are enrolled and covered by the FERS program. There are many details associated with the FERS program and this article should help Federal employees understand how it protects them, their income and their family in the case of an unforeseen injury or illness.
The first thing to understand is how it actually works - in other words, what has to happen in order for a Federal employee to be eligible for FERS Disability benefits. The answer, as expected, is not simple. There are several requirements that must be satisfied, but for the purposes of this article, three important requirements will be noted. The first requirement is that Federal workers must complete a full 18 months of service prior to any claims being made. Secondly, the program requires that due to injury or illness, a Federal employee must be disabled for useful and efficient service in his/her current position. Although this description and definition of disability protects workers in their current position, there is one final requirement that makes qualifying a bit more difficult. FERS Disability requires that the debilitating injury or illness must be expected to last for at least one full year. This is a very gray and unknown requirement, as many illnesses and injuries cannot necessarily be foreseen so easily.
Federal employees should also understand how much benefit they should expect if they ever require a disability claim. There is significantly more detail related to benefit distributions, but for the sake of simplicity, this article will cover the basics. The FERS Disability program will provide 60% income replacement in the first 12-months of a Disability claim. Although this may not seem like a lot, it is similar to any group Disability policy that exists in the private sector. The primary difference and problem with FERS is that after the first 12 months of a claim, the benefit will reduce to 40% income replacement. Unfortunately most households cannot afford such a large pay cut, especially with the additional expenses associated with a debilitating injury or illness.
The final thing to understand is how benefits are paid to Federal employees while on Disability claim. FERS Disability benefits are a part of a Federal worker's benefit package and therefore are provided/paid for by the Federal government. With Disability insurance, if a person is provided protection by an employer, any benefits received at the time of claim will be considered income and therefore will be taxed as such. This is an important point for Federal employees to consider. Although FERS provides 60% and 40% benefits, the actual income replacement will be much less once benefits are taxed.
As a Federal Government employee, it is very important to understand the structure of your Disability income protection. Although this benefit is provided for you at no cost, it does not exactly provide the greatest income protection available. For this reason, you may be eligible to qualify for supplemental coverage through an individual Disability insurance policy. This is not offered through the Federal government however, and you must obtain coverage through an insurance company. To review more information on FERS Disability benefits and the options available to Federal employees, visit FERS Disability Insurance Benefits.
Similar to most employers in America, the Federal Government does not exactly make information readily available for employees to find and review relating to group benefits and more specifically, Disability insurance. Disability insurance is arguably one of the most important types of coverage a person can have, and therefore is worth researching and understanding. Nearly all Federal Government employees are enrolled and covered by the FERS program. There are many details associated with the FERS program and this article should help Federal employees understand how it protects them, their income and their family in the case of an unforeseen injury or illness.
The first thing to understand is how it actually works - in other words, what has to happen in order for a Federal employee to be eligible for FERS Disability benefits. The answer, as expected, is not simple. There are several requirements that must be satisfied, but for the purposes of this article, three important requirements will be noted. The first requirement is that Federal workers must complete a full 18 months of service prior to any claims being made. Secondly, the program requires that due to injury or illness, a Federal employee must be disabled for useful and efficient service in his/her current position. Although this description and definition of disability protects workers in their current position, there is one final requirement that makes qualifying a bit more difficult. FERS Disability requires that the debilitating injury or illness must be expected to last for at least one full year. This is a very gray and unknown requirement, as many illnesses and injuries cannot necessarily be foreseen so easily.
Federal employees should also understand how much benefit they should expect if they ever require a disability claim. There is significantly more detail related to benefit distributions, but for the sake of simplicity, this article will cover the basics. The FERS Disability program will provide 60% income replacement in the first 12-months of a Disability claim. Although this may not seem like a lot, it is similar to any group Disability policy that exists in the private sector. The primary difference and problem with FERS is that after the first 12 months of a claim, the benefit will reduce to 40% income replacement. Unfortunately most households cannot afford such a large pay cut, especially with the additional expenses associated with a debilitating injury or illness.
The final thing to understand is how benefits are paid to Federal employees while on Disability claim. FERS Disability benefits are a part of a Federal worker's benefit package and therefore are provided/paid for by the Federal government. With Disability insurance, if a person is provided protection by an employer, any benefits received at the time of claim will be considered income and therefore will be taxed as such. This is an important point for Federal employees to consider. Although FERS provides 60% and 40% benefits, the actual income replacement will be much less once benefits are taxed.
As a Federal Government employee, it is very important to understand the structure of your Disability income protection. Although this benefit is provided for you at no cost, it does not exactly provide the greatest income protection available. For this reason, you may be eligible to qualify for supplemental coverage through an individual Disability insurance policy. This is not offered through the Federal government however, and you must obtain coverage through an insurance company. To review more information on FERS Disability benefits and the options available to Federal employees, visit FERS Disability Insurance Benefits.
Michael Relvas is an insurance specialist with MR Insurance
Consultants, an insurance services firm that assists individuals across
the country with Life and Disability insurance. Based in the Washington
Metro area, Michael has assisted many Federal Government employees with
their Disability insurance and Life insurance. If you are concerned with
making sure your income and family are properly protected, please feel
free to contact MR Insurance Consultants at 800-817-4522 or visit us
online at Disability Income Insurance.
Recommended Reading
Insiders Tips For Reducing Spending
Money Saving Tips And Ideas Covers
Practically All Areas Of Household
And Modern Living Expenditure
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Recommended Reading
Insiders Tips For Reducing Spending
Money Saving Tips And Ideas Covers
Practically All Areas Of Household
And Modern Living Expenditure
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