Disability Insurance


DEFINITION of 'Disability Insurance'

A program managed by the Social Security Administration that insures a worker in case of a mishap. Disability insurance offers income protection to individuals who become disabled for a long period of time, and as a result can no longer work during that time period. Employees who've paid the Federal Insurance Contributions Act (FICA) tax for a certain amount of time, are eligible to receive the Social Security disability income insurance.

Also referred to as disability-income insurance.

BREAKING DOWN 'Disability Insurance'

The Federal Insurance Contributions Act (FICA) is a United States law that requires employees to contribute a part of their earnings to fund Medicare and Social Security. Employees who have become disabled can receive this income insurance for at least one year. Income insurance payments begin on the sixth month of disability.

  1. Waiver Of Premium For Disability

    A provision in an insurance policy that states that the insurance ...
  2. Disability Insurance Trust Fund

    An account within the Social Security Trust Fund used to pay ...
  3. Disability-Income (DI) Insurance

    An insurance product that provides supplementary income in the ...
  4. Federal Insurance Contributions ...

    A U.S. law requiring a deduction from paychecks and income that ...
  5. Social Security

    A United States federal program of social insurance and benefits ...
  6. Medicare

    A U.S. federal health program that subsidizes people who meet ...
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