Insured Status for Social Security Disability

Social Security Disability is essentially an insurance program. A worker must have paid social security taxes in order to be “insured,” similar to paying premiums on a private insurance policy. Like any other insurance coverage, Social Security Disability coverage lasts for a limited period of time after an individual stops working. The maximum length of coverage is 5 years, but for individuals who worked only sporadically before they ceased working altogether, that period can be substantially less. This is how it works:

There are 2 kinds of insured status a person must have to be eligible for Social Security Disability benefits:

  1. Fully Insured: To be fully insured, an individual must have 10 years of credited work or 1 quarter of work credit for each year from age 21 to the age of disablement. The work need not have been done in any particular year; it must merely meet the required total number of quarters, depending on the claimant’s age.

  2. Disability Insured: This is a test of recent connection to the workplace. An individual must generally show 20 quarters or 5 years of work in the 40 quarters or 10 years immediately preceding when the person stopped working.

For an applicant over 31 years, he or she must have 20 quarters of coverage out of 40 calendar quarters, prior to becoming disabled. Another approximate version of the rule is that an applicant is eligible if she has worked and paid Social Security taxes for 5 out of the past 10 years. The rule for applicants under age 31 is less restrictive.

To determine an individual’s Date Last Insured, you must first count back 20 quarters of credit work, starting with the most recent credited recent quarter. Why does Date Last Insured matter? An individual who is no longer insured cannot be paid a disability benefit. Onset of disability must occur during an insured period, for example, as of or prior to the last date insured. The time a person has-from the date they ceased work to the date they allege their disability began-the harder it may be to demonstrate they meet the disability test. A person who files for SSD after he or she ceases to be insured, move prove the onset retrospectively.

Primary Insurance Amount (PIA) is the monthly amount an insured individual will receive pursuant to a formula which uses the insured individual’s earnings and the years of those earnings. The PIA is subject to an annual cost-of-living adjustment (COLA).

Family members may receive auxiliary benefits, which are divided among the spouse of the insured, if there are minor children under age 16 (if the spouse’s earnings are low enough) and minor children under age 18, unless the child(ren) are still enrolled full-time in high school, but which must end no later than 19 years of age.

Entitlement to Social Security Disability starts at the later of either 6th month following the onset of disability (5-month waiting period) of 12 months before the filing date.

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