Eligible faculty and staff members are provided with Long Term Disability (LTD) Insurance that provides income replacement for 66-2/3 percent of LTD Base Salary for periods of disability that exceed a 180 day elimination period. The monthly benefit cannot exceed $15,000 per month and is reduced by the value of other disability benefit payments.
LTD Base Salary is the employee’s budgeted salary prior to the date disability begins as defined below:
- For the period January 1 through June 30, the employee's budgeted base salary as of January 1 or the employee's initial enrollment date, whichever is later.
- For the period of July 1 through December 31, the employee's budgeted base salary as of the employee's annual salary adjustment date (July 1 or September 1) or the employee's initial enrollment date, whichever is later.
The premium cost for Long Term Disability Insurance is paid by the University. Employees are given the option of having the premiums paid on a pre-tax or post-tax basis.
- If the LTD coverage is provided on a pre-tax basis, there is no income tax paid on the premium. Any benefit received under the plan will be subject to federal income tax.
- If the LTD coverage is provided on a post-tax basis, the employee pays income tax on the value of the premium but does not pay federal income tax on benefits received under the plan in the event of disability. It is necessary to receive the benefit on a post-tax basis for a period of thirty-six months to exempt the full benefit from federal taxation.
Additional information on the Long Term Disability Insurance benefit can be found in the Summary Plan Description. Contact the Human Resources office for a copy.