Generally, employer-sponsored group long term disability benefits replace about 60% of salary (bonuses, commissions and overtime usually are not included), start when short term benefits are exhausted, and continue anywhere from five years to life. Often group long term disability insurance coverage is fully paid for by employers without any contributions by employees.

If you can obtain disability income insurance coverage through your employer, you need to know about the benefits. Find out how long after the start of disability benefits would begin and how long payments would continue. Then find out whether your employer’s plan takes other disability coverage (such as government programs) into account, and whether your long term disability benefits are subject to a maximum dollar amount. You should ask for a booklet that outlines and describes in detail the employer’s disability benefit program.

Your next step is to assess your financial situation. Add up all the benefits you, realistically, may qualify for under public programs, such as SSDI and workers’ compensation and through your employer’s group plan along with any monthly income you could count on from other sources. If the total approaches your-required-after-tax income, you can assume that you would be able to pay your day-to-day bills should you become totally disabled.

You need to remember, though, that a disability could result in additional expenses. You might face increased out-of-pocket health care costs and you also might need to pay for help with shopping, housework, yard work, cooking or transportation and even with more basic things, like eating, showering and getting out of bed. You might also need to pay for modifying your home with railings, ramps and wider doors to accommodate your disability.

If the total from employer benefits, public benefits and other programs along with your own resources will not be close to your pre-disability, after-tax income and will not be sufficient to support your family, you may want to consider buying additional individual disability income insurance to make up the difference.

As you do your calculation, you should know whether the amount of long term disability benefits you would receive would be reduced by the amount of government benefits you might receive. In addition, although disability income benefits from an individual policy are tax free, benefits from a policy paid for by an employer are taxable. This factor should be considered when determining your disability income needs.