First, what’s the difference between a disability pension and a “regular” pension?
A disability pension is awarded to men and women after a personal injury makes them unable to work permanently or temporarily. There is usually a minimum period of employment or work history required to claim this benefit, a medical exam may be required to corroborate the disability, and individuals generally receive compensation based on years of service–that is to say, the benefit amount can be contingent on length of employment. Disability pensions can be taken before the worker reaches retirement age. Social security disability insurance is an example of a disability pension in the United States.
In contrast, a pension is a fund contributed to by an employer on behalf of a worker. This is a retirement benefit in which the employer handles investment, and the beneficiaries are assured a certain amount of money, which the employer will issue when the individual stops working. Pensions are not affected by bad investments on the employer’s part; the beneficiaries receive a set amount of money at retirement. As previously described, pensions and similar retirement benefits that accrued during the marriage are marital property, and a divorced spouse is entitled to a portion.
Disability pensions are more complex. Depending on the circumstances and the way in which the benefits are calculated, a disability pension can be considered as marital property, separate property, or even a little bit of both. A portion of the disability pension can be seen as compensation for personal injury and therefore separate property, while a portion of this benefit can be viewed as earnings that accrued during the marriage. Obviously spouses need legal guidance when considering distribution of this retirement benefit. Another option is to to come to an agreement themselves with the aid of a mediator.
Disability Benefits/Disability Payments
If you’re getting SSI or SSI disability benefits, divorce can affect those benefits in many ways. For one thing, if you receive spousal support or alimony from your ex spouse, SSI will consider that part of your income, and your payments could change. (Child support is not considered income by SSI.) You will need to report your divorce and any alimony you receive from your spouse to SSI, who will then redetermine your benefits.
For SSI benefits based on your own work record/earnings record, compensation will not be affected by the divorce. This is because those benefits are based solely on your work record, not your spouse’s. However, you should take into account that a portion of those benefits are subject to garnishment to meet obligations to your spouse, like child or spousal support.
For some, disability payments may increase after a divorce. Benefits based on need, like social security, will take the loss of the income provided by your ex spouse into consideration, and the amount you’re entitled to could go up. Every case is different, and you must remember that alimony can also be taken into consideration when calculating compensation.