Federal government employees are eligible for both federal benefits and private disability insurance. But the supplemental coverage you need depends on the benefits offered by your government plan. Before you shop for a private policy to protect your income, know what coverage limits apply and how to find the right policy for your situation.
Disability coverage through the Federal Employees Retirement System (FERS)
Public employees are generally eligible for up to 30 days of paid leave for sickness or injury, similar to short-term disability insurance plans.
In addition, federal employees may be able to get disability retirement benefits through the Federal Employees Retirement System (FERS). Federal employees are considered disabled under FERS if they can’t perform “useful and efficient service in their current position” due to a medical condition or injury.  The total benefit you get depends on your age, any Social Security disability benefits (SSDI), your salary, and how long you’re disabled.
However, there are some disadvantages to FERS:
Benefits are taxable, unlike private disability benefits
Difficult to qualify for
It covers 60% of your income for the first 12 months of disability but then drops to 40%
Must apply for SSDI benefits before applying for FERS
SSDI benefits are subtracted from the total benefit
This means you may not receive the amount of federal disability coverage you expected — but you also may not be eligible for the amount of private coverage you expected either.
How to combine private and public disability insurance
Disability insurance companies don’t want people to be overinsured. If you have coverage through your employer, the insurance company takes that into account when setting your coverage limits.
This can make getting private coverage more complicated for government employees. “Federal employees are tricky because often they are unaware of the benefits they’ll receive from public plans,” says Jake Roszkowski, operations team lead at Policygenius. This is true for insurers, too.
With group coverage for private sector employees, an insurer simply subtracts the employer benefit from the maximum amount you can get under a supplemental policy. For federal employees, different insurance companies use different calculations to assume how much coverage you’d get from FERS.
Common calculations include:
Assuming you already have coverage for 40% of your income
Assuming you already have coverage for 40% of your income, up to $10,000
Automatically assigning you 20% of your eligible benefit amount
If you don’t know how much federal or private coverage you’re eligible for, you can find yourself underinsured. Find out this amount by talking to a benefits administrator or insurance agent before purchasing a private supplemental disability policy.
Why federal employees should get private disability insurance
Disability benefits through FERS are typically barebones and don’t provide the tailored coverage that many people need. A private long-term disability insurance policy can offer more robust coverage for most people. A private policy can also be customized with additional benefits such as:
Rehabilitation riders: This can help pay for vocational training after a disability.
Partial or residual coverage: A way to get partial benefits if your hours are cut back or you otherwise can’t work to your full potential to earn the same income as you did before you became disabled.
Future purchase option: This rider allows you to increase your coverage in the future without going through the underwriting process again.
Even if you're eligible for federal benefits, you'll get more flexibility and more comprehensive coverage out of a private disability insurance policy.