Residual disability benefit.
In plain English
A residual disability benefit (sometimes called partial disability) is a policy feature that pays you a scaled-down benefit when you can still work but earn less because of your condition. Instead of an all-or-nothing payout, it fills part of the gap between what you used to earn and what you earn now. The payment is usually based on the percentage of income you have lost. It also helps when you are recovering and easing back into work part-time.
01Why it matters
Many disabilities do not stop you from working entirely; they just cut your hours or your output, and without this feature a plain policy might pay nothing even though your income dropped sharply.
02The math, step by step
You earned $6,000 a month before a back injury. Now you can only work part-time and earn $3,600, a 40% income loss. A residual disability benefit typically pays roughly 40% of your full monthly benefit. If your full benefit is $4,000, you would receive about $1,600 a month while you work reduced hours.
03What this is NOT
A total disability benefit pays the full amount only when you cannot work at all. A residual benefit is the opposite case: you are still working and earning, just less, so it pays a partial amount tied to your lost income.
04Receipts
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Plain-English answers from our glossary. Receipts included. Never advice.
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