Short Term Disability Insurance in CA
CA Short Term Disability Insurance: Extra Maternity Benefits
California short term disability insurance fills a big hole for many couples with growing families. A private policy can increase your income coverage in the event you are unable to work due to accidents, illnesses, pregnancy complications, normal childbirth, and postpartum disorders.
Explore several topics in more detail to ensure the financial health of your family.
CA Short Term Disability: Pregnancy, Maternity Leave
Private short term disability insurance in California for pregnancy and maternity leave makes great sense for women whose incomes exceed $94,000, and those whose employers are not required to continue subsidizing healthcare costs during a family leave. Both segments of the population are left exposed if complications of pregnancy translate into significant time away from the job.
Purchase your policy several months before you might conceive. Most policies contain an exclusion for normal childbirth that ends after nine months. Not every child is delivered full term, so give yourself a cushion.
Your policy provides extra income support for normal childbirth, any complications of pregnancy that might arise prior to delivery, and biologic postpartum problems that may delay your return to the workforce.
For women with higher incomes, you can fill the hole left by the state plan. And for women concerned about a spike in health insurance costs, you may be able to take home more income while on pregnancy leave than you made while working. Of course your expenses may be much higher. But having the added income helps you keep your medical insurance, and get the prenatal care you and your baby need.
CA Short Term Disability: Calculating Take-Home-Pay
A private California short term disability insurance policy makes sense for women concerned about long absenses from work. The first question to ask yourself when determining if you need supplemental coverage is: what will the state plan pay, and how does that compare to my take-home-pay prior to becoming disabled or going out on maternity leave.
The answer is not always simple and varies for each person asking the question. First you must understand how the state plan makes payment determinations. The government website provides the most complete information, but the essential points are boiled down here in understandable language - or so we hope.
While you are working deductions are made from your paycheck for federal and state income taxes, FICA contributions, unemployment insurance, SDI contributions, and sometimes health insurance, and 401K contributions, etc. For illustration purposes let say these deductions equal 33% of your gross earnings meaning your take-home-pay is 66% of your gross income.
The state program uses a formula that equates to payments of about 55% of gross income. These payments come to you free of taxes, and other deductions. For most people this results in an increase in spendable income.
But there are two buts.
First, there is a weekly cap of $987. Workers earning more than $93,387 will hit this cap. The chart below outlines several take-home-pay scenarios. A 33% pre-disability paycheck deduction is assumed. Women in income ranges above $100,000 may face a significant cut in pay.
California Short Term Disability and Pregnancy Leave
A private California short term disability insurance policy becomes important again when mom takes an extended pregnancy leave.
The second but is often silent and deadly.
Even if your income is below $93,387 you may be left with a big shortfall during your family leave. The shortfall comes in the form of COBRA insurance premiums. If a couple has their health insurance at the woman’s place of employment these costs may rise dramatically during an extended pregnancy disability. This can happen in one of two ways.
If her employer is not subject to FMLA or state maternity leave laws, then she may be responsible for the full share of medical plan costs. Most employers with fewer than 50 employees are not required to hold your job open during a family leave. Nor are they required to continue subsidizing health insurance premiums. Many couples are unaware of just how much an employer contributes to these costs - until hit with an extra bill when it is least affordable.
Many women experience complications of pregnancy and need to stop working to take bed rest. Her pregnancy is experiencing problems, so maintaining the proper medical insurance is vital. But her employer stops the subsidy and offers her to continue coverage through COBRA. The premium costs can be staggering. Premiums vary widely, but the average monthly costs are about:
CA Short Term Disability Insurance
Use short term disability insurance in CA to supplement what the states pays. A policy can replace up to 2/3 of your income when combined with the state plan. The monthly payment is capped at $5,000. CA state disability entitlements are capped at $987 per week or 55% of income in 2012, and last for only twelve months. You can elect a plan that continues paying claims for as long as 24 months.
Most plans will offset the payment amount against what the state program pays - if you are eligible. This helps avoid over-insurance. Also state insurance regulations require that private policies be sold as a rider on a base accident indemnity plan. These base plans are quite affordable, have a nominal impact on premium rates, and may be quite helpful in the event of an injury that prevents you from working.
California Maternity Leave Laws
Three California maternity leave laws combine to provide up to seven months of job protected, partially paid leave spanning your pregnancy, maternity leave, and baby bonding time. Entitlements are limited and don't apply to everyone.
Unemployment compensation can sometimes be utilized during maternity and/or paternity leave situations. The rules are very precise. If you think you may qualify for compensation you should contact the state unemployment offices.
Code regulation title 22-1256-10 provides for unemployment compensation for any worker who voluntarily leaves his or her position because of a compelling need to attend to the health of a family member. You must take reasonable steps to preserve your employment, and show that there were no reasonable alternatives.
How long can you pay your bills? Who picks up employer health insurance costs? Will you still have a job when you return from maternity leave? Follow the link below to answer these important questions.
If you are looking for extra short term disability coverage the best place to look is where you work. Policies that cover pregnancy are not sold directly to individuals. We maintain a network of agents who can work with your employer to set up a voluntary option for you and your co-workers.
Agents are based in most areas in The Golden State including: Anaheim, Bakersfield, Chula Vista, Fontana, Fremont, Fresno, Garden Grove, Glendale, Huntington Beach, Irvine, Long Beach, Los Angeles, Modesto, Moreno Valley, Oakland, Oceanside, Ontario, Oxnard, Rancho Cucamonga, Riverside, Sacramento, San Bernardino, San Diego, San Francisco, San Jose, Santa Ana, Santa Clarita, Santa Rosa, and Stockton.
CA Unemployment Compensation