What Is Temporary Disability Insurance?

The New Jersey Temporary Disability Benefits (TDB) Law requires employers to carry Temporary Disability Insurance (TDI) for their employees. TDI is a short term disability benefit that provides cash for covered employees who stop working due to a physical or mental health condition or other disability unrelated to their work. A healthcare provider must certify the length of time needed for the employee to recover and return to work. The maximum timeframe for which an employee can receive benefits is up to 26 weeks.

In order to be eligible for benefits under TDI in 2024, the employee must:

• Have worked in New Jersey for 20 weeks per benefit year and earned at least $283 gross income per week during that time period; or
• Have earned a combined total of $14,200 in the year before the claim is filed and have been working for the employer within two weeks of becoming disabled.

TDI is not available for employees of the federal government, out-of-state employees, employees of faith-based organizations, or independent contractors. Local governments, including school districts have the option whether to provide benefits to their employees.

The TDI application f must be filed within 30 days from the first day of the disability. The application is made by completing and submitting Form DS-1 online at the Division of Temporary Disability and Family Leave Insurance web page, by mail to the Division of Temporary Disability Insurance, P.O. Box 387, Trenton, NJ 08625-0387, or by fax to (609) 984-4138. There are three parts to the application. Part 1 is to be completed by the employee; part 2 is to be completed by the doctor; and part 3 is to be completed by the employer.

If approved for TDI benefits, the claimant is paid 85% of their average weekly wage up to the maximum weekly benefit rate for that calendar year. In 2024, the maximum weekly benefit rate is $1,055 per week.

If the individual is not able to return to work after short-term disability benefits have been exhausted, the individual will have to consider long-term disability.

What is long-term disability insurance?

A long-term disability insurance policy provides benefits to individuals with serious medical conditions who can no longer work. Long-term disability insurance is a private plan purchased through an insurance company or through a worker’s employer. The policy terms indicate the criteria that must be met, the benefit amount, and the time limit for receiving benefits.

To apply, a claim must be submitted to the insurance company. The insurance company reviews the claim, and this process can take many months. The insurance company can request copies of the individual’s medical records to establish eligibility and may request that the individual agree to an independent medical exam by a doctor selected by them. The individual must meet the insurance company’s specific definition of disability for up to six months after being approved for benefits. If the disability does not continue for at least six months after approval, the individual may not be eligible for long-term disability benefits.

If the individual does not have long-term disability insurance, they may be eligible for Social Security Disability Insurance (SSDI) benefits or Supplemental Security Income (SSI).

What are Social Security permanent disability benefits?

The Social Security Administration (SSA) has two programs, both federally funded: Supplemental Security Income (SSI) and Social Security Disability Insurance (SSDI). In order to be found disabled under SSA regulations, an individual must have physical and/or mental impairments that have lasted or are expected to last for a continuous period of at least 12 months, causing the individual to be unable to perform full-time work.

Both programs use the same application process and share one medical disability determination. Once an individual is determined to be medically eligible for disability, SSA will determine the type and amount of benefits. 

Social Security Disability Insurance (SSDI)

To qualify for SSDI benefits, an individual must have worked long enough and recently enough to qualify for benefits under SSA’s system of work credits. Credits are based on total yearly wages or self-employment income, and up to four credits can be earned each year. The income needed to earn a work credit changes annually—in 2024, it was $1,730 for one credit and $6,920 for four credits. Generally, in order to be eligible for SSDI, 40 credits are needed, 20 of which must be within the last 10 years, ending with the year the disability began. Younger workers may qualify with fewer credits.

The amount of SSDI benefits is also based on earnings. SSA uses an individual’s average monthly earnings to calculate their monthly benefit. Benefits can begin five months after the onset of the disability, but not earlier than one year before the filing date of the SSDI application. The individual must be found disabled before the expiration of the date for SSDI coverage, which is roughly about five years after the individual stops working.

If the SSDI recipient has minor children, they may be able to receive an additional monthly benefit up to the maximum family amount. The dependent benefit continues as long as the individual has at least one qualifying child under the age of 18 (or 18-19 and a full-time student under grade 12).

Individuals receiving SSDI can have earned income without impact on the SSDI benefits. For 2024, the amount of earned income is $1550 or less per month.

Supplemental Security Income (SSI)

Individuals without a work history or not enough quarters to qualify for SSDI may be eligible for SSI benefits. SSI benefits can start the month after the date the person became disabled but not earlier than the filing date of the SSI application. Since SSI is “need based” the individual must have little or no income and limited resources—$2,000 or less for an individual or $3000 or less for a couple. The monthly benefit amount is set by Congress each year and there is a one-third decrease in SSI benefits if the individual is receiving free housing. New Jersey provides an additional SSI state supplement. For 2024, the maximum SSI amount in New Jersey is $974.25 for an individual and $1,443.50 for a couple.

Individuals receiving SSI may see a decrease or an elimination in benefits if they have other income. The first $20 of earned or unearned income will not affect SSI benefits. The first $65 of earned income per month will also be discounted. After that, SSI benefits will be reduced by one half of the balance of earned income.

This information last reviewed: Aug 30, 2024