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VIEWPOINT: Ask Rusty: How Does SSDI Work with Private Disability Insurance?

By Russell Gloor


Dear Rusty: If someone is collecting long-term disability through his/her company and the company states the employee also must apply through Social Security, how does this work? Does the amount of Social Security decrease from the amount that the person would normally receive upon retirement? Is long-term disability for life, or just until you are of retirement age? 

Signed: Concerned

Dear Concerned: It’s common for private long-term disability (LTD) insurers to require that you apply for Social Security Disability Insurance (SSDI) benefits. Typically, the private LTD benefit will be offset (reduced) by the federal SSDI benefit. 

The SSDI benefit amount, if awarded, will be the full Social Security benefit earned up to the point the recipient becomes disabled and unable to work. That means that people on SSDI before full retirement age (FRA) gets their FRA amount earlier (FRA is somewhere between age 66 and 67, depending on the year of birth). The SSDI benefit will be based on the disabled person’s lifetime earnings history, unreduced for claiming earlier than full retirement age. SSDI will automatically convert to regular Social Security retirement benefits at the same amount when FRA is attained. Thus, getting SSDI doesn’t detract from individuals’ FRA benefit amount; rather they get their FRA amount earlier. 

Social Security disability benefits last for as long as you remain disabled, or up to your full retirement age. To be eligible, the disability must be expected to last for at least one year, and the disability must render you unable to perform significant work. You must also have worked recently (usually at least 5 of the last 10 years) to maintain eligibility, and you must have contributed Social Security FICA payroll taxes (or self-employment taxes) from your work earnings. Only very limited work earnings are allowed when collecting Social Security Disability Insurance benefits, and the Social Security Administration may periodically require confirmation of continued SSDI eligibility. 

Applying for SSDI is a relatively easy process that can be done online at, or by calling Social Security directly at (800) 772-1213. Depending on the nature of the disability, it usually takes three to five months to obtain a determination and, if SSDI is approved, there is a five-month wait for benefits to start. If the SSDI application is initially denied (about 65 percent of all initial applications are turned down) you can exercise several levels of appeal, starting with simply requesting a reconsideration by the Social Security Administration, followed, if necessary, by a hearing with an independent administrative law judge, a review by the SSDI Appeals Council, or even an appeal to federal court. Hopefully, if the applicant is now on private long-term disability, the SSDI application will be initially approved.        

Russell Gloor is a national Social Security advisor at the AMAC Foundation, the nonprofit arm of the Association of Mature American Citizens (AMAC). The 2.4 million member AMAC says it is a senior advocacy organization. Send your questions to:

Author’s note: This article is intended for information purposes only and does not represent legal or financial guidance. It presents the opinions and interpretations of the AMAC Foundation’s staff, trained and accredited by the National Social Security Association (NSSA). The NSSA and the AMAC Foundation and its staff are not affiliated with or endorsed by the Social Security Administration or any other governmental entity.