What distinguishes Long Term Disability from Short Term Disability?

The distinguishing feature of Long Term Disability (LTD) insurance is that it can provide benefits for an extended period, often until the insured reaches retirement age, typically around 65. This coverage is essential for individuals who may experience a significant disability that prevents them from working for a considerable duration, enabling them to receive financial support over the long term.

In comparison, Short Term Disability (STD) insurance typically provides benefits for a shorter duration, usually ranging from a few weeks to a few months. The purpose of STD is to cover temporary disabilities that may arise due to illness or injury, while LTD is designed to offer more extended financial assistance in cases where recovery is prolonged or the disability is permanent.

Long Term Disability plans often come with specific terms regarding the duration of benefits, which is where the age of 65 comes into play, as many policies are set to expire around the retirement age.

Other options do not accurately describe the differences between the two types of disability insurance, as they might imply limitations or formats (such as lump sum payments) that do not typically define the essential characteristics of Long Term versus Short Term Disability insurance.