One option to fill this gap is to purchase disability insurance on your own. Image: Olivier Le Moal/Shutterstock.com
Notably absent among benefit programs that the federal government provides for its employees is disability insurance.
It does offer injury compensation benefits through the Federal Employees Compensation Act program for being unable to work due to illnesses or injuries, but only if those conditions were caused by work. And disability retirement has eligibility conditions of its own, which you may not be able to meet.
One option to fill this gap is to purchase disability insurance on your own. However, the cost often dissuades people from doing that.
One way to hold down the cost of disability insurance is to extend the “elimination,” or waiting, period before disability benefits begin. Your choices can be anywhere from as little as 30 days to possibly even a full year after the onset of disability.
The longer this period, the lower the premiums—but remember, during that time, the policy is not paying benefits to you, you are self-funding for that time.
With this in mind, you might have some of your insurance set to pay after 30 days, some after 60 days, and some after 90 or 180 days. This will help hold down premium costs yet still provide some income while you wait for all the coverage to take effect.
What’s more, as you grow older and accumulate more wealth, you might want to increase the elimination period and self-fund for a longer time. Your coverage with a 30-day waiting period might be extended to 60 or 90 days, for example. Insurers don’t mind being asked to take less risk, which will be the case if you extend the elimination period. You probably can make such changes and reduce your premiums without having to take a new physical exam.
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See also,
Legal: How to Challenge a Federal Reduction in Force (RIF) in 2025
The Best Ages for Federal Employees to Retire
Alternative Federal Retirement Options; With Chart
Primer: Early out, buyout, reduction in force (RIF)
Retention Standing, ‘Bump and Retreat’ and More: Report Outlines RIF Process