Buying disability insurance after diagnosis, and living with SSDI
 

Hi all. I'm wondering if one can buy disability insurance after their diagnosis has been made? I'm currently in kind of a limbo, I have neuropathy, but not an official diagnosis for why it's happening. I suspect it may be hereditary, and if it is what I think it may be, I will be unable to work at all as my hands won't work well and could curl up. So I'm not worried about being approved, but I am worried about what will happen once I get on SSDI. Does anybody have a suggestion for getting disability insurance now? How much does it cost and what does one have to do to get it?

I live in Northern California, and really wouldn't want to leave as my friends and family are here. I also have a 10 year old daughter who needs to be supported, a husband who could never earn even half what I earn, and so I'm the breadwinner in the house and make a good wage. I don't want to live in the ghetto or out in the sticks. I need to be able to have a support system. I also vowed never to live in an apt again. I find it amazing how little they'll pay and how they expect one to live off of it. What I assume they'd pay wouldn't even cover my rent. It sucks to have such a high cost of living, but it's worth it to be in this area, at least while I'm working. I was hoping to buy a house soon with some settlement money, but how am I supposed to pay a mortgage on $500K if all I'm getting is SSDI?

I have no idea how long I have until I become permanently disabled or if I'll get better. Lots of tests are needed to find out for sure, but I figure it's best to plan now just in case I need these things later.

Disability insurance
 

Are you talking about a private disability policy or one that is through an employer? In Utah they have two types a short term disability and a long term disability plan. Neither of these would pay you for life like the government disability and social security. These private plans are made for like a police officer who might get injured in his line of work. The insurance company would pay for the determined amount of weeks that the policy specifies a percentage of the employees income. Then after they have paid their limit that is it. If the person can still not work he has to apply for government disability. I do not think they sell private disability plans you have to be offered these plans through an employer. Things could be different in California though. Hope this helps.

What you're describing would be a pre-existing condition if you applied for a private disability insurance program at this point.

There is a temp state disability program in CA that you could receive if your doc determines you're unable to work.

Do not assume that getting SSDI benefits will be a simple or quick process. There are military vets rated at 100% disabled by the VA that spend years fighting for SSDI benefits even.

Settlement from where?

You may qualify for subsidized housing. You may want to check into the USDA direct rural home loan program. You may qualify for section 8 housing. If you are unable to work, you may find it to be very difficult to afford housing in the Bay Area.

Settlement is from medical malpractice suit. Just waiting for a couple final things, everybody agrees they screwed up and so I don't have to fight for it. I'm hoping once I pay my bills, get a new-to-me car and a few things around the house, like a new bed, I'll have $100K-ish. But I'm still waiting to see exactly. It's enough to put a down on a house where I live, and afford the house payment on what I make *if* I'm working.

I didn't mean to say it would be easy, just easier than, well, a lot of other cases as I'd be able to prove it by a gene test and horribly curled up hands (if it gets that far). I have been on short term disability before. I know I could live off that, but not SSDI. Can my employer add it to my benefits and that would allow me to qualify? I guess I need to talk to an insurance agent.

I'll check out the USDA loan thing. I looked briefly and would qualify at their mid-income level. It would just be finding a house in an area that is close enough to my support system.

You haven't mentioned you're diagnosis, but if it's something serious enough to cause permanent disability, 100k isn't very much money. Especially if you earned a competitive salary and plan to stay where you're at.

There are no easy answers to these issues. Read the Catch 22 thread in the stickies I started.

I think it is a really bad idea for a person who believes they won't be able to work to commit to an expensive mortgage that they can only afford if they continue to work. I will go as far as saying it would be foolish.

Qualifying for SSDI for the majority of applicants is a long drawn out process. More people are denied than approved. Have you read the regulations for your condition or are you assuming that curled up hands will be sufficient? How curled up is enough to prove you can't do any kind of work? Your genetic condition is not stopping you from working now, so putting a name to it will not prove you cannot work. What does matter is your ability to function, not the name of your condition. Some people with diabetes, breast cancer, multiple sclerosis work. Some can't. It can be two years before you see the pittance of money that SSDI will pay you. If you are approved. How would you live while waiting?

I can't imagine an disability insurance company agreeing to cover you for prediagnosed illness that they know will lead to disability. That is like applying for life insurance on your deathbed or car insurance after the accident. But I am not the insurance company.

Your husband can either get more hours at his current job or get a second job. You may have to choose between a small rental in an expensive city or a modest affordable home in a smaller town.

Work as long as you can drag yourself to the office. Pare down your lifestyle. Save more money than you think you can now. $100,000 is a nice chunk of money, but it won't last long if you have high expenses and have no money coming in. Save it, don't spend it. Invest it safely also. Don't think there is a quick (and safe) way to turn it into a larger amount. You don't have the luxury of time if you can't work. There are always ways to reduce expenses. Plan for the worst case scenerio, especially if you think it is inevitable. Becoming disabled is almost always synonomous with reduced standard of living since it is the ability to work that support most people's lifestyle.

I'm really just trying to look at all the "ifs" that could possibly be out there. If I buy a house now (modest here is $350-400K, seriously that's cheap for NorCal), and if I can work for 10 years, sell it and move to a cheaper area, then I will be able to actually buy a house paid in full because of the equity I earn in the house. I have no clue what's going to actually happen, if things will get better or worse. I'm just trying to look at my long term goals now so I am not living in some crappy section 8 apt in 10 years instead. People don't buy houses and then go "gosh, I'm going to retire in 10 years so that's a bad idea", they plan ahead, move to a cheaper area when they retire or buy a smaller house when the kids leave.

Pare my lifestyle down? Are you kidding me? I have nothing to pare down. Eventually my child will move out and support herself (I hope so).

Yes, I'm working now. I'm not really sure why I'm getting the lecture. I'm not an idiot. I am just uneducated about disability insurance and wanted to know what to do about it from an experienced person, not a salesperson. I really didn't think I needed to tell everybody about what my symptoms are, we're all here because we have pains, illness and injury. I'm fully aware that some people with horrible illness and injury work through it.

Anticipating you might be fully disabled in 10 years is a completely different scenario than being so in the near future.

My perspective is that I've met enough people that have to depend on family, government entitlements, or face homelessness, that I'm very conservative about explaining what people may face. It's not unusual whatsoever. I've known people that have taken 30k Work Comp Settlemnents, including future medical, and gone and spent most of it on a new car and then found they were unemployable.

It's also not uncommon for it to take YEARS to get SSDI approval. Even after that approval, you might be unable to afford a mortgage on a home in the price range you're describing.

People don't think it will take 3 or 5 or 8 years to receive SSDI approval. And your first post seemed to assume that the process wouldn't be difficult.

SSDI is not income replacement. You're correct that is why you needed a separate disability policy. It will be enough to afford to get by in most parts of the country. Many are forced to move or buy a smaller home, etc.

Your idea about picking up disability insurance seems incredibly unlikely, and possibly fraudulent.

These are hard truths.

I don't mean to be insulting or intrusive, but the realities of permanent disability are very different than healthy people assume.

Best of luck to you!

Hi Chaos,

Welcome to NT !

People keep 'warning' you that the SSDI approval process won't be easy because of misassumptions like this. Getting approved for SSDI isn't about proving that you have a medical condition, even a severe medical condition. It is about proving that the condition keeps you from working......and not just from doing your current job, but that it keeps you from doing ANY kind of work. When you consider that someone in a wheelchair or with curled hands could still be a greeter at Walmart, then you switch your focus to proving to the SSDI folks that you can't even do that. If anyone with your condition could work, you have to prove that your case affects you much worse. Most people who don't know someone who has applied for/gotten approved for SSDI would assume you'd just need a diagnosis and documentation from your doctor that you are unable to work.

I don't think anyone meant to sound like they were lecturing you. Tone, which can mean so much in the interpretation of words, just doesn't come through online. It's difficult to say, "I think you are incorrect on that point" or "Are you sure you thought that all the way through?" and not sound like you are 'correcting' someone when you are technically trying to correct them.

I hope that you won't take offense to my comments either.

I know California is an expensive place to live. I absolutely understand wanting to stay in that area, especially if that is where your support systems are. I live 30 miles from Boston, on the south shore. My extended family is only 10 miles out. I'd like to move closer to them, but I can't affpord to. I can't afford to stay where I am either. I'm hoping that I can swing it if I move an hour south of here. In addition to keeping to a budget and eliminating frivolous spending, moving to a more affordable area is part of paring down. Hopefully you won't have to pare down that much.

If you buy a modest house soon and it appreciates in value or at least you build some equity, that would help your long term plans. Unfortunately, many people who were buying ten years ago had the same plan, but due to the economy and real estate values crashing, they find themselves upside down on their mortgages. Posters here are just trying to warn you to remember that and not to assume that investing in real estate is going to get you ahead. Sure, historically that has worked out well for many, but it is still a gamble.

Please don't insult section 8 housing. That would be offensive to anyone reading this thread that might live there.

You don't have to tell everyone about your symptoms. Others are just trying to make the point that SSDI approval is about how your symptoms of a condition affect your ability to work, NOT what your diagnosis is.

You have to complete a thorough health history to apply for disability insurance. Your neuropathy would be considered a pre-existing condition and would not be covered. If someone fails to disclose a condition when applying, they would be commiting fraud.

I don't think any of us think that our SSDI checks are enough to live well off of. I don't think SSDI intended they would be. The system was developed so that people wouldn't be penniless and starving. They now send out a SS/SSDI form every few years to let us know what our monthly payments would be if we were to become disabled or retire so that we can plan for what other disability insurance or retirement savings we should get to afford a certain lifestyle. I was 39 when I became disabled. I thought I had plenty of time before retirement.....and didn't want to 'waste' money on an expensive disability insurance plan. Oops ! Even knowing what happened to me, I've been grumbling because I have to cough up $1400 for my husband's life insurance premium this week. It's tempting to not 'throw away' the money on his insurance, but if he dies without it, I can't bury him or get the kids through college. I know that the SS death benefit is only $260 (ish) I shouldn't be surprised by that and complain about it if I knew that upfront.

I hope that you are able to keep the neuropathy at bay and are able to work for many, many more years. Good luck !

I tend to be blunt and so my opinion can be taken as a lecture especially when I am trying to explain the reasons for my opinion.

The original question was how to buy private disability insurance with a pre-exisisting known condition that will lead to disability because SSDI will not be enough money to provide a living in an expensive part of the country because the poster is averse to living elsewhere.

Shorter answer; probably not possible.

And I also own a nice home in northern California in a nice neighborhood and the price is 1/2 of what the poster says is required. But I don't live in the bay area in and around San Francisco either.

Good advice for anyone; work and save and live below your means.

The day I was hired I signed up for the best supplemental long term disability the company offered. the day I needed it I was glad. The company's complimentary plan would have run out long ago. Mind lasts until 65 when SS kicks in.

The down side is that once you get qualified for SSDI your LTD benefits are off-set by the SSDI, so you end up getting your disability amount, but it is divided between SS and the disability company, plus the tiny cost of living increases in SS.

And I am pretty sure pre-existing conditions were excluded, but it has been so long ago I am not sure.

Getting insurance after the fact
 

It is impossible to get private short term or long term disability insurance after you are diagnosed. Otherwise you will be committing fraud and if caught they will not be happy to say the least.

On the other hand a person can get life insurance after becoming disabled. It is not cheap especially depending on what you are on ssdi for.

From my experience if you are on ssdi for a mental reason then most life insurance companies will charge super high rates.

On the other hand if you are on ssdi for say being in a wheelchair then you are more out to get it cheaper but it will still be much more than someone that is not on ssdi.



True story:

A friend of mine smokes 2 packs of cigs a day. He drinks like a fish. His job is very dangerous. He travels out of the country on a regular basis. He is 39. He has a record of drinking while driving. Actually been to jail for it four times.

I could go on and on about him but I think you get the point.

Anyways, he has life insurance with the same company/person that I use.

I'm 47, married with two children. I have no record other than a speeding ticket I got over 25 years ago. My blood work is fine as far as cholesterol, triglycerides, ldl is good, hdl is good etc. I do not smoke nor have I ever, I do not drink nor have I ever. I think you get the point.

Point is my friend has $500k of life insurance and pays $45 per month.

LOL.........I have $250k of life insurance and I pay $209 per month. Simply because I'm on disability.

Now you tell me who is more likely to die. My friend that drinks and drives on a regular basis, single and has sex with anything that moves, travel abroad on regular basis, has a very dangerous job etc..

Or

Me, someone that may leave the house once every couple of weeks to go to the doctor or the like.

People usually throw that suicide thing out but I always tell them that no insurance will pay if that happens.

I can understand us paying more than healthier people but fives times as much is ridiculous and nothing short of highway robbery.

I have been on my wife about getting short and long term disability insurance for a while. She seems to think she will never need it. LOL...you would think her having a husband that once was able to work many hours but now is disabled would open her eyes.

Rake

in new york insurance companies have to pay out for someone who committed suicide if it is more than a year since they bought the policy.

I can only speak from my experience with STD and LTD insurance - an employer paid benefit. I worked for my last employer for about 9 1/2 years and that entire time we had the STD insurance. It was in the last two years there that the LTD benefit was added. Depending on your plan, STD should pay for the first six months and then LTD would pick up and pay until SSNRA (SS Normal Retirement Age). If you qualify for SSD, then LTD would offset the difference. There are always pre-exisiting conditions with LTD. There is usually a 12-month waiting period with a 3-month look back for illness claims. Accidents are usually paid without issue. What this means is if the plan is effective Sept 1, 2013 and you are taken out of work by your physician in within the first year (say June 1, 2014) they will go back to the effective date of Sept 1, 2013 then 3 months prior (June 1, 2013) to see if you were treated for the condition in that three months prior to the plan effective date. If you were, then they will not cover it. If you have the benefit effective date of Sept 1, 2013 and are taken out of work Dec 1, 2014, then they will not have that look back period because you have been on the plan for the 12 months with no claim for that condition. Does that make sense? There are diffierent terms on different employers plans, what I described was my employers. It's hard to explain.

So with me...LTD benefit effective date was Aug 1, 2011. The last day I worked was Dec 28, 2012. I satisfied the waiting period to be covered by LTD, but I was denied both STD and LTD (well, they paid STD for one week). They claim that my medical records do not support my disability...which is a load of crap. My PM dr sent me for a FCE (functional capacity evaluation) and it said I could do sedentary level work. It did not test me in a real working environment, it only tested how much I could lift, push, pull, stuff like that...it was so irrelevant to my work as a financial & human resource manager! I have RSD in both hands and shoulders, left arm and leg, face, both feet, trunk and face. It is very painful and hard to use my hands for very long. My drs have notated it, but the insurance carrier is hanging on to that FCE no matter what the drs say. I have appealed the decision and it was denied, I am getting ready to file my second appeal. Get this, I was approved for Social Security Disability on the first try, I will start receiving it next month.

To me LTD benefits are worthless. These insurance companies are known for collecting premiums and denying claims. There are claims here and there that have been paid without problem, but I think when there is an accident or surgery involved those claims go through a little easier. When there is illness, good luck! Since my second denial, I have researched my carrier online and denial seems to be the norm for them.

If you are really interested in purchasing either of these benefits, read the plan documents THOROUGHLY!!!

Long ago when I started working, straight out of college - was hired on at a busy local hospital. The administrator who took all of us new hires & new nurses told us we should sign up for optional disability, because the part that is payed through the hospital at no extra premium is not enough to live on. Around $200 a month. Best advice anyone ever gave.

I worked there for 5 years, worked at another couple hospitals & returned to roost at the first place 8 years later. By then, policy (or the lady who was willing to give it to us straight) had changed & no one advised us how important it was to sign up for LTD optional plan. There is no medical exam when you are first hired, they cover all employees no matter what & for any "window" (time frame of waiting before they issue payments) from 30 days to several months. I choose 60 days - wish I had made it 30 because you still wait another 30 days to have any income. It just starts to accrue at the end of the waiting period you select. I didn't need it for another 10 years, and then only for a few months. Now after my 2nd back surgery I am in a huge amount of pain and I don't see how I could hold a job - any job. It takes me 10 or 12 hours to get a minimal amount of crappy sleep - I am in severe pain for the first 3 or 4 hours I am first up - and I have no idea what days I am able to get anything at all done. I don't see what job or employer would be satisfied with me drifting in for a few hours whenever I was having a good day & have no problem with me calling off on all the others. If I have a good day I can cook or try to tidy the house, but I move at my own pace & can stop at any point I need to. Have to hire a housekeeper for all routine cleaning like vacuuming or mopping, etc. My once beautiful yard looks like a riot. :(

Anyway signing up for optional disability is so important. We don't stay young & strong forever, no matter how infallible we feel. I would advise anyone who can, to sign up for LTD and get a shorter waiting period for benefits to kick in.

The company my employer uses is Standard, they have been completely willing to cover my claims at least so far. Now that it doesn't look like I will be returning to work, I hope the worm doesn't turn. We shall see.