Long-term disability insurance (LTD) is an insurance policy that protects an employee from loss of income in the event that he or she is unable to work due to. Long-term disability insurance is an insurance policy that provides income replacement for workers if they become unable to work due to an. Long-term disability insurance (LTD), on the other hand, provides coverage if you 're out of work for a longer. Long term disability insurance offers a worker a portion of their salary if they are unable to work for a longer period—typically a period of over. LTD insurance is insurance that begins once your STD benefits and employer- granted sick leave has been used up (LTD typically lasts more than 6 months). Long-term disability insurance pays a percentage of your salary, usually 50 to 60 %, depending on the policy.